April 25th, 2018 by Jacob Tuwiner
Learning how to buy Zcash with credit card, PayPal, or Bitcoin can be confusing.
That’s why we made this guide – today you’ll learn about the best place to buy zcash, and how to do it yourself. Don’t have any experience buying cryptocurrency? Don’t worry! This guide is geared towards beginners.
Buy Zcash with USD
You cannot directly purchase Zcash with USD. In order to buy, you must first purchase another cryptocurrency with USD, then trade it for Zcash.
Before Buying Zcash: Purchase Bitcoin or Ethereum
Before buying Zcash, you have to buy Bitcoin or Ethereum first. To learn how to buy Bitcoin, follow our guide.
Step 1: Send to an Exchange
After buying Bitcoin, you need to send it to an exchange that trades Zcash. In this guide, we will be using Binance.
After signing into Binance, look in the upper-right corner, hover over the Funds tab, then select Balances.
Scroll down to Bitcoin, then click deposit.
Copy your Bitcoin deposit address. Be sure to use your own address, and not the one shown in the picture.
Sign into Coinbase, then select the accounts tab.
Under your Bitcoin wallet, select the send button.
Paste your Binance wallet address in the recipient box. Enter the amount of Bitcoin in dollars that you would like to send, then click continue.
You will then be prompted to confirm your transaction. You will also be shown the miner fee for your transaction. This fee varies, and does not go to Coinbase, but instead to the miners who verify blocks on Bitcoin’s blockchain. If you have 2-factor authentication enabled, you will also be asked to enter your 6-digit verification code.
After you send your Bitcoin, it may take some time to arrive. Don’t panic immediately if your Bitcoin has left Coinbase but not arrived at Binance. Depending on the Bitcoin network and websites themselves, transfers may take some time to process.
Step 2: Buy Zcash
After your Bitcoin transfers to Binance, then you can purchase your Zcash.
Back on the Balances tab, search for ZEC and click Trade. In the dropdown menu, select ZEC/BTC.
In the middle of the screen, select the Market tab. In this tutorial, we will be buying Zcash with a market order. There are other types of orders, but market orders are the easiest to use.
Enter the amount of Zcash you would like to buy. The price you pay per Zcash will be shown at the top right in dollars and in Bitcoin. After entering the amount you would like to buy, click Buy ZEN. Binance will take a .1% fee from your transaction.
After buying, you should be able to view your Zcash in the balances tab.
Step 3: Safely Store Your Zcash!
Once you buy, your Zcash is stored on the exchange wallet. Although your Zcash has been received, it is not totally secure. Every wallet has a private key, or a sequence of numbers or letters. Each private key is unique to one wallet, and allows access to the contents of that wallet.
If you have Zcash on an exchange wallet, they control the private keys. This leaves your tokens more vulnerable to manipulation by others. If the exchange is hacked, the hackers will use your private keys to access your Zcash.
Additionally, if an untrustworthy exchange pulls an exit scam, they could walk away with your tokens. While these events may seem unlikely, they have occurred before multiple times.
The best way to store cryptocurrencies is usually a hardware wallet, as they combine security and accessibility. Some cryptocurrencies are unable to be stored in hardware wallets, but Zcash is hardware wallet compatible.
Zcash is an ERC20 token, a type of token based on the Ethereum blockchain. All ERC20 tokens can be stored on hardware wallets, but in order to do so, you must configure your hardware wallet with an ERC20 software wallet. One of the most popular ERC20 software wallets is MyEtherWallet (MEW).
For more information on cryptocurrency wallets, you can check out our guide.
Introduction to Zcash
Contrary to popular belief, most cryptocurrencies, including Bitcoin, aren’t as private as they might seem. The traditional blockchain acts as an open ledger – all transactions are entirely transparent. In Bitcoin’s case, wallet balances and addresses are transparent.
Zcash is a decentralized peer-to-peer token. In fact, it is a fork of Bitcoin. Moreover, similar to Bitcoin, Zcash also has 21 million token cap.
Although, unique from most other projects, Zcash harnesses the power of advanced cryptography to offer complete privacy to its users. If anonymity is important to you, Zcash may be a good token to consider.
Zcash utilizes zk-Snarks or Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge to achieve its high level of privacy.
The token allows you to choose which kind of transaction you’d like to make. You can make a transparent transaction or a private transaction. Simply choose to send Zcash to the recipient’s transparent address (t-addr) or shielded address (z-addr).
This diagram illustrates how transparent & private transactions take place:
For more information regarding Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge, Zcash’s algorithm and how everything works, check out Blockgeeks’ guide.
Should you Buy Zcash?
At this point, you know how to buy Zcash – although, before you invest your hard earned money, you probably want to know what you’re investing in.
In the next section, you’ll learn about Zcash’s development team, community, and use cases. This way, you’ll be able to make a more informed decision before you decide to spend (or not spend) your money.
Here’s a quick video overview:
Zooko Wilcox is the cryptocurrency’s founder and CEO. With more than 20 years of experience with decentralized systems, cryptography and information security, Wilcox is fit for the job.
He is also the founder of Least Authority Enterprises. They were founded to create freedom-compatible technologies, believing in the importance of internet privacy.
According to the Zcash’s website:
He is recognized for his work on DigiCash, Mojo Nation, ZRTP, “Zooko's Triangle”, Tahoe-LAFS, BLAKE2, and SPHINCS. He is also the Founder of Least Authority.
Other members of the team have attended prestegious schools such as UC Berkeley, MIT and Johns Hopkins University.
For more information regarding Zcash’s development team and other employees, click here.
Edward Snowden has shown his support for the project, saying:
Zcash is the only altcoin (that i know of) designed and built by professional and academic cryptographers. Hard to ignore... Zcash's privacy tech makes it the most interesting Bitcoin alternative. Bitcoin is great, but if it's not private, it's not safe.
Since Zcash is a fork of Bitcoin, it also has a hard cap of 21 million coins. The total token supply is not expected to be completely mined until 2032. Furthermore, the token is not ICO funded or pre-mined.
A group of investors funded the project with $1 million in an effort to kickstart the development. The investors incrementally received 10% of the total token supply over the first 4 years of as a reward for their initial investment.
Zcash is focused on the privacy of its users – therefore, anyone looking for a privacy coin should consider Zcash. The token improves upon Bitcoin’s blockchain by enabling semi-transparent processing. User data is revealed selectively.
Zcash protects consumer data by keeping their transactions private. However, it is difficult to say that Zcash will be adopted by businesses, as it is imperative to track spending for record keeping and tax purposes.
On the other hand, Zcash is an important asset for those looking to preserve their privacy.
NOTE: We are not financial advisors and none of this information should be taken as investment advice. We take no responsibility for any losses incurred through cryptocurrency trading.