Zcash mining process is highly centralized? Some experts call it "enterprise currency"

Over the past few months, more and more cryptocurrency enthusiasts and investors have begun to emphasize the importance of Zcash, explaining its potential impact on the digital currency ecosystem due to its privacy and anonymity. However, there are still quite a few experts and users in the community who are not buying into the Zcash hype.

Advantages

Many investors and experts, including Dan Morehead, CEO of Bitcoin venture capital firm Pantera Capital, have high hopes for Zcash, saying it can make up for Bitcoin's shortcomings. Morehead listed several advantages of Zcash:

1. Selective transparency

2. GPU mining effectively prevents centralization

3. More efficient management

As investors were very optimistic about Zcash, its market value reached 4000亿美元once it was released. According to CNBC executive Brian Kelly, Zcash市值一度超越了Facebook .

Although the price of Zcash has soared, its centralized operating model has still attracted a lot of criticism.

Flaws and Criticisms

The main flaw of Zcash, a "decentralized" and "private" cryptocurrency, is the centralization of its foundation and development team. Zcash is operated and maintained by a US company.

In view of the centralized nature of Zcash, which is dominated by developers and network operators, some developers and enthusiasts in the cryptocurrency community have given it a nickname - “企业币” , because law enforcement agencies or government agencies can easily manipulate Zcash and abuse their power to influence its development process.

Angel investor Peter Black, who is also a Bitcoin expert, criticized Zcash for its centralized control. As a cryptocurrency, Zcash violates the basic concept of digital currency and its operation is not carried out in a distributed environment.

Zcash (ZEC) is an enterprise currency. Digital currency should not be controlled by any single group, enterprise or central bank.

Black and other cryptocurrency experts are right to worry about Zcash’s centralization, as it could have a negative impact on the mining process.

For digital currencies, mining mechanism and inflation rate are two important technical difficulties. Usually, developers spend a lot of time studying these two points. Zcash is very special. The entire mining process is based on创始密钥（Genesis keys） “主私钥”（master private key） , which is 6个人共同持有.

In simple terms, this master private key is what Zcash founder and CEO Zooko Wilcox calls "toxic waste," but in fact it is the key to the normal operation of the Zcash network's anonymous mixing function. Once the key is leaked, malicious holders can create countless Zcash. And this high-intensity generation method is likely to cause the network to crash.

The problem is that these six people who have access to the master key are from the same company. If the company is poorly managed or the key is stolen, the entire Zcash network is vulnerable to transaction attacks.

Several cryptocurrency communities, especially the Monero community, have strongly condemned Zcash's centralized mining and deployment process, as this approach violates the basic principles of cypherpunk and distributed digital cash.

As the Zcash mining process unfolds, more and more questions arise. For example, the six people mentioned above can get 10% of the mining profits as their operating expenses. Some supporters compare this mechanism to ICOs, but compared with the pre-mining and deployment process of other anonymous currencies such as Bitcoin and Monero, this mechanism still largely represents a highly centralized system.