Do we see Zcash as MoE?

General
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I’m asking because I struggle with this question. The goal of Satoshi was Electronic Cash, the whitepaper is literally titled “A Peer-to-Peer Electronic Cash System.” Zcash is fundamentally built on Bitcoin, with privacy on top. So we inherited that “cash” framing.

But Cash is Money, and Money is supposedly SoV, UoA & MoE. But who is going to use a MoE that is not somewhat stable? I mean, really?

Here’s what bothers me even more: proper Zcash privacy requires holding funds in shielded addresses over time. Quick in-and-out breaks the privacy model—you create timing correlations, and the anonymity set doesn’t help you. So you can’t just “use ZEC as a payment rail” and convert quickly to hedge volatility. The privacy model requires you to absorb the price swings.

If you could pick any base currency for yourself, and say any you pick is magically private, which one do you pick? I wouldn’t pick ZEC or BTC for that matter, honestly.

So what was Satoshi’s idea / expectation, I’d like to understand. Was he expecting people to do all their transactions in Bitcoin eventually? The whitepaper mostly addresses the payment mechanism—trustless P2P transfers—not monetary stability. Do you know @zooko ?

Look, if Zcash is not MoE, that’s fine. Maybe ZEC is private SoV, or maybe Zcash is the privacy infrastructure layer and ZSAs become the actual cash. I don’t know.

But we should be clear about what we’re building. Where do we see ourselves in 50 years? What does success actually look like? Because “private electronic cash” might not be it—at least not with a volatile base currency and a privacy model that punishes you for trying to avoid that volatility.

What are we actually trying to be?

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These are very good questions and reflections. With your permission, I’ll take these to the Z|ECC summit.

Ps: As a general rule I advice people to avoid existentialism around holiday season. :sweat_smile: Happy New year @outgoing.doze :heart:

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I could (and probably will) spend hours crafting a more thought-out response to this, as it’s something that’s been on my mind a lot too.

Others here know Satoshi’s mind much better than I do, but I think he was trying to solve a very specific problem. He described Bitcoin as a payment rail intended to reduce friction in retail transactions, even at the level of microtransactions. The way Satoshi talks about it sounds very much like a primary MoE to me, with its function as an SoV being basically an afterthought.

But this isn’t the Church of Satoshi, so we can ask: “What should Zcash be?”

I love/hate this question because it gets at the central tension of money. Make a thing work too well as an SoV and that detracts from its function as an MoE. Likewise, a perfect MoE can’t really function as an SoV.

Why not? Because a thing with perfect SoV properties is too precious to part with. A thing that’s expected to appreciate is something one would only sell out of desperate need, preferring to spend other, less valuable assets first. This crunches liquidity and transparency in price discovery, and undermines its use as a currency. This is essentially Gresham’s Law: the “better” or “harder” a currency is, the more likely it is to disappear from circulation as people hoard it, spending the “bad” money instead.

For a thing to work as a day-to-day MoE, it has to be highly liquid and not psychologically precious. Arguably the most successful MoE in history is the USD—a significant part of its magic is the relatively predictable decay in value. As much as I detest the knock-on effects of inflation, it acts as an incentive to provide liquidity and flexible expansion of the money supply arguably has other benefits for economies.

IMO, ZEC is approaching “perfect money” status. This is great, because I think SoV is an extremely compelling use case. On the other hand, many of us are here because we believe that transactional privacy is a prerequisite for freedom, not just private wealth storage. By making ZEC “unstoppable private money,” we undermine (but don’t eliminate) its use case as currency.

My priority is ZEC as an SoV. While using a deflationary asset for daily transactions is difficult, it’s a tractable problem. But if we try to force better MoE dynamics, we risk killing the SoV thesis entirely. And in the context of Zcash, if you kill the SoV, you kill the privacy model too, because if no one wants to hold ZEC long-term, no one gets the strongest form of privacy. Neglecting SoV mechanics here doesn’t just hurt investors; it destroys the entire utility of the network.

ZSAs are a possible answer for the MoE layer—maybe tokens on an L2, or things like NEAR intents.

A related question that vexes me: If (when?) ZEC replaces BTC as “The Coin,” does it undermine its own success by demonstrating that a digital asset is replaceable and slated for obsolescence?

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ZEC. Why else would anyone be here? :smiling_face_with_three_hearts: I think zooko was right about the DEV fund being Zcash’s most revolutionary feature.

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Angst01’s point about Gresham’s Law resonates. If ZEC is hoarded as SoV, we need to solve long-term security funding without relying on transaction fees.

A rough 5-year sketch:

Year 1-2: Mandatory shielded (deprecate t-addresses, maximize anonymity set)

Year 2-3: PoS transition (lower security costs, holders secure what they hold)

Year 3-4: Demurrage-funded security (~1% annual on holdings → stakers). Solves the “fixed supply vs security budget” problem permanently. You pay for the vault that protects your savings.

Year 4-5: Retire the dev fund. Transition to community-funded, minimal governance. Protocol ossification—maximum credible neutrality.

The thesis: ZEC as the private, sustainable savings layer. ZSAs can handle MoE use cases.

Worth exploring. Fear is the only thing that can hold us back.

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ZSAs are exciting, but I think it’s premature to look at ZEC volatility today and rule out its use as MoE later. Volatility reduces with adoption. Assets behave very differently once they become widely accepted as money, and no cryptocurrency has come close to achieving that yet… but Zcash has the potential to.

Look at gold. Today gold is considered volatile, but that wasn’t the case when gold was widely accepted as money.

I think ZEC is the future of money, including MoE, SoV, UoA, etc. I know it’s cliché, but we’re still early.

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That’s what I want, but we’re here to succeed so we need a rational path to achieve the electronic private cash objective; otherwise we need a different one. Btw, that’s what Bitcoiners have been thinking too, for 16 years, and still to this day. They have a few big problems they too, are scared to address.

Who’s going to be least fearful first and show leadership. Us, that’s who.

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Bitcoin has/will never be able to achieve status of money, at minimum because it is not fungible. No offense to any Bitcoiners, but the dream of Bitcoin becoming money is frankly delusional. I direct this criticism towards myself as much as anyone, having spent 10+ years as a fan of Bitcoin.

Zcash, however, actually meets 6 of the 7 properties of money already today, and the final property (acceptability) is attainable through increased usability, scale, and adoption. All of which Zcash is tackling at break-neck pace.

We are on the rational path towards becoming money. Increasing usability (better tools like Zashi, better scale like Tachyon promises, payments integrations, etc) and increasing adoption are the way we achieve the final property of money and become the first cryptocurrency to ascend and compete in the global contest to become the “new money".

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I like your take, and honestly I want your view to succeed because it’d be amazing.

But,

The market is irrational, always has been, always will be.

I have a stash of stablecoin that I use for:

  • buying assets that I consider undervalued
  • selling assets that I consider overvalues
  • everyday spending

I have different stashes unconnected between each others because I use my SoV ZEC to initialize them and eventually close those stashes as well.

So I understand and I like optimism. I understand and I like the exciting explorations devs are doing. But fundamentally, I’m an actual ZEC user. And from that position, I can tell you that I don’t see when I’m going to use my ZEC day to day.

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That’s fair. I also appreciate some healthy skepticism. It’s important.

Time will tell, but I’m definitely a Zcash optimist. I’m already able to use my ZEC to pay for many of my online services directly today, not to mention so many other things I can pay for through cross-pay. 2025 has marked the greatest leap in both usability and adoption in Zcash history, and I’m excited by what we may accomplish if we continue this growth through 2026 and beyond

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In 2025, the US dollar is roughly down 40% against gold, 60% against silver and 89% against ZEC.

It doesn’t seem to bother the stablecoins maxis :joy:

It might all reverse in 2026 (or not), but fiat currencies (and their relative sovereign debt markets) don’t appear very stable to me, the pendulum swinging ever more violently between inflation and deflation until the whole edifice comes crashing down.

So in the future you probably won’t have a choice anyway to use Zcash or other cryptos because there won’t be anything else of value left.

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In this case the problem is not stablecoins, it’s… USD.

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Yes. But the US dollar is the less worst fiat currency since all the others derive their value from it,

The only true stablecoin would be gold backed, but then it suffers from counterparty risks in a world where trust will become very scarce.

The snake is eating its tail so best to skip all the drama by holding shielded ZEC and see where everything stands when the dust settles.

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You just argued ZEC isn’t stable enough to be a MoE. Nobody spends an asset that might double next month, and nobody accepts one that might halve by dinner.

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P2P, electronic cash is about being able to make any payment you want. Not necessarily buying a cup of coffee.

Don’t get trapped into the notion that ZEC needs to be used for daily payments in a functioning, modern society to be a successful MoE.

Just my 2 cents.

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It’s a lot of “it depends”. I use bitcoin for payments quite regularly and it is more widely accepted for online services, and in grey markets, than ZEC currently.

Today, I’d probably rather use ZEC if able, of course.

But if acceptability is a key metric, then we should acknowledge that bitcoin is currently ahead.

This may change.

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So MoE doesn’t need to be used for daily payments, but also Bitcoin wins because more people actually use it for payments? Pick a lane mate.

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So MoE doesn’t need to be used for daily payments, but also Bitcoin wins because more people actually use it for payments? Pick a lane mate.

I think you’re misrepresenting my statement here, pal. One, I didn’t say bitcoin “wins”. I just said it’s more widely accepted. Is it not right now?

It’d be great if you could use ZEC for everyday payments. What I’m saying is that it doesn’t need to be used for this to be a successful MoE.

That’s all.

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Yes, absolutely, but in the context above, I am talking about the 7 properties that make an asset “money" (durability, portability, divisibility, uniformity, limited supply, acceptability, and fungibility). Bitcoin is ahead in terms of acceptability, but because Bitcoin is not fungible, it will never become money and will always struggle to find broad acceptance as MoE. Zcash, on the other hand, has unlimited potential.

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Totally understand the point/argument :slight_smile:

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