- The privacy-focused cryptocurrency Zcash (ZEC) has risen more than 2,300% in only a single year, placing it in the top 10 by market valuation.
- Early token distribution is still a point of contention for Zcash’s Founders’ Reward and development funding scheme.
- With just about 26% to 31% of circulating ZEC being held in shielded pools, optional privacy is still a major topic of discussion.
Zcash (ZEC) has seen one of the rises in the cryptocurrency market. Over the year, ZEC has gained more than 2,300%. This surge helped it climb into the 10 cryptocurrencies by market capitalization according to CoinGecko data. Now that ZEC is trading near record highs, some critics are asking if its strong position reflects network strength or just a powerful story being told in the market.
Zcash’s latest rally is a narrative bid. A big market cap does not mean a coin earned its place. Sitting near Solana and Hyperliquid on a ranking list does not mean Zcash does what those two do.
The launch was not fair. For the first four years, 20 percent of every block reward… https://t.co/g1PNEKWCNr
— Chun (@satofishi) September 8, 2026
Chun Wang, co-founder of F2Pool and founder and CEO of Stakefish, criticized Zcash’s latest rally in a September 8 post on X, where he argued that the surge is driven more by market narrative than fundamentals. Wang, who posts as @satofishi, questioned whether Zcash’s market capitalization reflects genuine network utility, pointing to its launch structure, funding model, optional privacy, governance disputes, and security history.
Zcash’s Controversial Founders’ Reward
One of the main criticisms concerns Zcash’s original token distribution. During the four years of the Founders Reward, 20% of each block reward went to the founders, employees, advisers, and early investors.
The total came to 2.1 million ZEC, or 10% of the coin’s 21 million supply. Critics compare this structure with Bitcoin, where block rewards initially went directly to miners.
After the Founders’ Reward ended with Zcash’s first halving in November 2020, a development fund replaced the mechanism.
Optional Privacy Remains A Debate
Zcash allows users to decide whether to use transactions, which are different from privacy-focused coins like Monero. Recent data from the Zcash ecosystem shows that shielded pools now hold between 26% and 31% of all ZEC in circulation. That’s an increase compared to 2024, when the share was only around 8%.
Some people think privacy should be the default, not something you have to turn on. Others believe giving users a choice makes privacy more practical and useful.
Governance Conflict Raises Questions
Zcash also faced a major governance dispute in January 2026, when the Electric Coin Company team resigned following tensions with Bootstrap’s board.
The departure caused worries about leadership and coordination in the ecosystem. Still, the Zcash Foundation said that no one organization runs the network. They also said the open-source protocol was working fine as usual.
Orchard Vulnerability Adds Security Concerns
Another issue involves a vulnerability discovered in Zcash’s Orchard shielded pool. The flaw had reportedly existed for several years and raised theoretical concerns about unauthorized ZEC creation.
The Ironwood upgrade, activated on July 28, closed the old pool and introduced a turnstile mechanism designed to enforce the cryptocurrency’s fixed supply. No evidence of counterfeit ZEC issuance has been presented.
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