Zcash (ZEC) - All you need to know
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Ways to invest in Zcash
The most direct approach to investing is to sign up with an online broker or cryptocurrency exchange. There you can buy, sell, or trade Zcash in accordance with your chosen investment strategy.
If you don’t want to manage your own portfolio, you can use a variety of investment vehicles to get exposure instead. There are mutual funds and ETFs (exchange-traded funds) that provide easy access to a diverse selection of coins. Learn more about the different investment approaches in the links below.
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What is Zcash?
Launched in 2016, Zcash is a cryptocurrency with a big focus on privacy. It works in much the same way as Bitcoin but gives its users the option to ‘shield’ their identities when the transactions are logged on the blockchain.
How does Zcash work?
In some ways, Zcash is just like any other form of anonymous digital cash. It uses advanced cryptology to obfuscate information that is usually publically available when using non-anonymous cryptocurrencies like Bitcoin. The big difference with Zcash is the focus on giving users the option to hide or reveal their transactions.
There are plenty of legitimate reasons for wanting to keep transactional information private including companies wanting their movements hidden from competitors and users in repressed countries looking to avoid detection when buying and selling.
Zcash allows users to choose a z-address (hidden) or a t-address (transparent) when sending or receiving funds. Users can also allow trusted third-parties to see a z-address by handing over a view key.
How to invest in Zcash
You can invest in Zcash in many different ways. The list below gives you a rundown of all the best options so you can work out which one works best for you. Read through them and use the list to help you create an investment strategy.
- Broker platforms. Brokers are the simplest and most straightforward way to invest in Zcash. Create an account, fund it, and navigate to the coin page to find instant buy and sell prices. Brokers charge a flat fee or a percentage commission on every trade but they are usually the most beginner-friendly platforms, with lots of useful material to help you get started.
- Cryptocurrency exchanges. Exchanges are a little more advanced than brokers but generally offer better prices and a wider range of coins. Rather than buying through a middleman, exchanges let you trade directly with other users. The main thing to watch out for is that some don’t accept fiat currency deposits at all (like GBP or USD), while some smaller coins are only available if you buy another cryptocurrency, like Bitcoin, first and use that to buy your chosen coin.
- Funds. A fund is a managed portfolio controlled by an investing portfolio. The fund manager makes the decisions on behalf of everyone who deposits money in the pool, choosing what to invest in based on what’s likely to achieve the best results. Funds usually have quite high barriers to entry so might only be appropriate for wealthier investors.
- Mutual funds. The average casual investor is better off with a mutual fund. Mutual funds offer many of the same benefits as a fund: a managed, diverse portfolio where the decisions are made by a professional. They’re easier to buy, however, and you can invest in one just like you would a stock through your broker.
- Zcash ETFs. Exchange-traded funds are another method of investing where the tough decisions over what to buy are taken out of your hands. Instead, an ETF buys all the assets in a particular market to track the performance of the whole index. ETFs are ideal for beginners and you can buy one of those just like a stock as well.
- Crypto debit cards. Debit cards give you the opportunity to spend your Zcash on day-to-day purchases. Crypto debit cards are growing in popularity and more and more merchants are accepting payments in them. They work just like any normal debit card, just enter the details and pay to spend your crypto coins.
- Smartphone apps. Mobile apps let you manage your Zcash on the go. There are apps that let you buy and sell coins, trade them quickly, or invest them to earn interest on what you hold. Brokers often have the best apps but many other platforms like exchanges and wallets offer them as well, and a good app can be the best way to stay on top of your coins.
- Zcash wallets. Wallets are a method of storing coins that keeps them safe from malicious activity. They are generally a better place to store them compared to leaving them in your exchange or broker account, because a wallet protects them with a layer of encryption so that they can only be accessed by entering a private key.
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Fact-checking & references
Our editors fact-check all content to ensure compliance with our strict editorial policy. The information in this article is supported by the following reliable sources.
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