The CEO of Digital Currency Group is swimming against the tide in the cryptosphere, gobbling up a significant amount of Zcash, despite the negative comments the crypto-currency regularly attracts. At stake is ZEC’s potential for the future, as, like Ethereum, the asset is poised for a revolution in its business model.
Fewer ZECs in circulation, more Zcash for Digital Currency Group CEO
On December 1, 2021, Digital Currency Group CEO and founder Barry Silbert announced in a tweet that his company would be purchasing $85 million worth of Zcash (ZEC), which equates to approximately 376,106 ZECs at an average price of $226. Silbert had already indicated in his tweet on November 20, 2021, that he would be buying ZEC, while some cryptophiles are not shy about saying all the good things they think about Zcash :
Wow, you all hate the $ZEC. I’m going to buy more.
Whales are reportedly hoarding ZEC, anticipating the withdrawal of many tokens from circulation. ZEC holders will indeed soon be able to store their holdings in a dedicated ZEC smart contract, with the blockchain switching from proof of work to proof of participation.
A little Ethereum in Zcash: from proof of work to proof of participation
ZEC’s lead developer, Electric Coin Company (ECC), had announced in November 2021, this switch to proof of participation within the next three years. This change in the consensus mechanism would, according to ECC, limit downward pressure on ZEC due to immediate liquidation of the cryptocurrency by miners who want to quickly exchange it for bitcoin (BTC) or fiat.
This change will further allow ZEC to dive a little deeper into DeFi by offering staking services, and it is also according to Senior Vice President of Growth at ECC, Josh Swihart, “a possible path to on-chain governance mechanisms for ZEC hodlers.” Moving away from proof-of-work to proof-of-participation is also expected to reduce “ZEC’s energy footprint.”
Some crypto projects act as a muse for others. Zcash seems to be inspired by Ethereum, which also decided to exclude miners from the game by switching to proof of participation with Ethereum 2.0. It has in turn inspired Tezos in improving its privacy.
