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ZEC token, a privacy and anonymity-based cryptocurrency, recorded a slight boost in price today after identifying and solving some wallet security issues. Zcash Foundation partnered with Defuse Security to identify a vulnerability slowing down transactions on Zcash Light Wallets.
Security website PrivacySavvy provided the following expert commentary about the Zcash wallet vulnerability as we reached out:
“Privacy is a critical aspect of any cryptocurrency wallet, and vulnerabilities like the ones found in the Zcash wallet can compromise users’ privacy and security. Wallet providers and developers must prioritize security and conduct regular audits to detect and fix vulnerabilities promptly. As users, we must also take responsibility for our own security by using trusted wallets and following best practices for securing our cryptocurrency holdings.”
ZEC saw impressive price rallies in February and hit a new high of $50.03 on February 20, 2023. However, the coin met some pullbacks due to the market-wide downturn in February, plus some discrepancies in its wallet functionality.
ZEC coin gradually declined from $50.10 on February 20 to $39.65 on March 3. Since then, the token has not recovered back the loss. But Zcash is 92.16% up from its all-time low of $18.94, recorded on March 13, 2020.
Following Zcash Foundation’s announcement on March 3 regarding the wallet vulnerability, the ZEC token price started increasing, though with slight pullbacks here and there. Today, Zcash is trading at $36.21, with a 24-hour price increase of 0.03%.
ZEC Price Improves After Solving Security Issues
As of March 17, the token had a 2.3% price increase, climbing from $34.16 to $37.24. Again, on March 18, Zcash recorded a 9% price gain. Although it has seen a few pullbacks over the past three days, the token is gradually recovering from its past week’s losses. According to CoinMarkerCap data, Zcash prices have rallied 9.35% over the past seven days. The coin currently ranks #80 on CoinMarketCap, placing it among the top 100 cryptos.
One of the reasons for Zcash’s price decline in March is the recent performance problems that affected Zcash wallet users. The Zcash wallet is unique for its ability to offer privacy and anonymity to users. If this feature fails to function as expected, users will lose interest in the service or lose funds to hackers. And it may reduce the Zcash token’s adoption and price as a result. It was evident in the drop in ZEC’s trading volume from $65.4 on March 2 to $31.96 on March 9, 2023.
The Zcash Foundation has been exploring options to solve this problem. The firm employed Defuse Security’s expertise and has been assessing the Oblivious Message Retrieval (OMR) to determine if it can solve the performance problems.
On March 3, they proposed integrating OMR into the Zcash Light Wallet to enable fast note detection and improve privacy for the wallet. However, after evaluating the OMR and its compatibility with the wallet, the Zcash team planned to explore other alternatives, like deploying detection keys that would not require a network update.
Zcash Trading Volume Increase Slightly Following Wallet Improvement Proposal
Since the Zcash foundation and the security firm identified the problem and outlined ways to fix it, users appeared to have regained confidence in the wallet service. The token price started increasing gradually, and the trading volume increased by 5.86%.
The trading volume started increasing again earlier on March 10, and by March 15, ZEC recorded over $67 million in trading volume. But the trading volume declined again on March 16 after the token recorded an 8.1% fall in price before retracing up on March 17.
Besides the Zcash wallet performance improvement, the Zcash foundation launched a Minor Grant Program for small projects in the Zcash ecosystem. The program offers up to $75,000 in funds to smaller projects in the Zcash ecosystem and might contribute to pushing the Zcash token price.