Privacy and anonymity are two terms often associated with cryptocurrencies. In reality, very few coins provide either of these features. ZCash, through its shielded transactions, aims to grant users more privacy. So far, the adoption of this technology remains relatively low.
Shielded Transactions on ZCash
For those unaware of how ZCash works, a brief explanation is necessary. It is designed to protect users’ privacy through various methods. There are different transaction types” private, deshielding, shielding, and public. For any privacy-oriented currency, the public transactions need to be avoided as much as possible. That is often much easier said than done.
To accommodate the adoption of shielded transactions, various wallets support this technology. As such, one would expect this “option” to quickly become the norm, alongside with proper private transactions. After all, shielded addresses and their balances are not visible on the blockchain. It is of great interest to those who want to achieve financial privacy using cryptocurrencies.
As it turns out, the adoption rate of shielded transactions is not that great. More specifically, under 10% of all ZCash transactions are fully shielded. This is not too impressive by any means, but there are some statistics that may offer a glimpse of hope for the future.
In terms of partially shielded transactions, things are looking a bit better. As much as 20.2% of all ZCash transactions make use of this implementation. In total, over 30% of ZCash TXes make use of shielding, either partially or in full. This is still well below the levels people would like to see. Improving these numbers may require a completely different approach.
Stagnation is a Concern
Judging by the chart below, it is evident there hasn’t been any notable increase in the amount of shielded ZEC compared to the circulating supply. Although this percentage hasn’t dropped either, there is no real growth to speak of. Things are slowly improving in the past month or so, but there is still a lot of work to be done.
As of right now, just 5.81% of all ZEC coins in circulation benefit from shielded transactions. This figure pertains to continually shielded ZEC, and not those counted as shielded once or twice.
In March of 2017, over 12.6% of the supply took advantage of these privacy options. That level has never been reached since. It makes one wonder why there is seemingly so little interest in shielding ZEC, as that is what it is effectively designed to do. If one owns a privacy coin, using it through public transactions is rather counterproductive.