Is ZCash a better buy than Bitcoin in October?

Zcash, ZEC, Bitcoin, BTC, falling wedge
image from medium.com

Key ZCash Takeaways:

  • ZCash privacy coin is on the verge of a network upgrade dubbed Halo Arc.
  • The Network Upgrade 5 will also advance the protocol possibly granting more yields to the investors.
  • Bitcoin flashed bullish signs.
  • The ZEC/BTC pair was in a downtrend, but a recovery is possible.

YEREVAN (CoinChapter.com) – ZCash (ZEC), a privacy coin from Electric Coin Company (ECC), might be a profitable investment in October. The ZEC/USD exchange rate stood at $113.4 in the Friday session (12% advance in three days). It might outshine Bitcoin due to a Network Upgrade and the Halo Arc launch.

Halo Arc and ZCash

Halo Arc is a suite of upgrades for the ZCash protocol, as announced by ECC back in April 2021. The suite includes updates to the Zcashd (consensus node), an ECC wallet prototype, and SDKs (Software Development Kits). The company initially planned the release for the summer but pushed the date further to October 1.

ZCash, which provides enhanced privacy for its users, will transition to a “trustless recursive” version within the Halo Arc. In detail, it will allow greater scalability and remove the “trusted setups” involved before. Instead, the latter creates a secret number with each transaction, and the ZCash protocol uses a derivative of that number to increase privacy.

However, ECC claimed that the trusted setups were flawed. The potential possibility of culprits retrieving the secret number if some of the nodes involved don’t eliminate the “cryptographic toxic waste.”

The trustless recursive is a zero-knowledge proof, a protocol in which a statement transaction is true without providing any proof other than the statement itself.

This is all built on top of Halo, which will usher in a new era of zero-knowledge cryptography and means, for this first release, increased confidence in the money supply by removing the trusted setup necessary for current zero-knowledge proving systems.

Josh Swihart, the Vice President of Growth at ECC.

Also read: Cryptocurrencies must not be regulated, says Tesla chief Elon Musk.

Network Upgrade 5 (NU5)

The Network Upgrade has a list of potential Zcash improvement proposals (ZIPs) that the community must approve before launch.

In detail, ZCash uses shielded transactions, as opposed to transparent ones. Shielded transactions don’t reveal the addresses and completely hide the details of the transactions. Fast forward to NU5, one of the ZIPs will introduce a “next-generation” shield protocol, dubbed “Orchard.”

Halo on Zcash creates fertile ground for new Zcash-inclusive solutions, with the potential to surpass the importance of our previous work with zero-knowledge proofs. It’s an evolution in cryptography and creates a new baseline for interoperability, additional assets, scale, and adoption

said the announcement from ECC.

All the improvements above constitute a ground to assume Zcash’s success in the coming month.

Also read: Bitcoin Mayer Multiple Indicator sparks huge rebound hopes as BTC reclaims $42K

Meanwhile, Bitcoin…

…had a tough time in September, with an overall monthly loss of over 7%. However, the flagship crypto traded at $47,228 in the Friday session and advanced by 16% in 3 days. BTC broke out of the falling wedge formation it traded in for the past six weeks.

The falling wedge pattern had two converging trendlines that capped the digital asset’s attempts to break in either direction and drove the price down. However, the formation promises a bullish reversal after the wedge exhausts itself. So far, Bitcoin has followed the prediction and adopted a bullish bias.

Bitcoin daily chart. Source: BTCUSD on TradingView.com
Bitcoin daily chart. Source: BTCUSD on TradingView.com

Moreover, experts like Meltem Demirors, the Chief Strategy Officer of the digital asset manager Coinshares, believe that Bitcoin is on its way to reaching $100,000 in value by the end of the year.

Also read: Bitcoin is on its way to $100K in Q4, says executive; 3 reasons why

ZEC Vs BTC

The ZEC/USD pair has also done well in the past three days, possibly following Bitcoin’s footsteps. The digital asset also flashed a falling wedge on the daily chart, suggesting an upcoming uptrend.

Zcash (ZEC) chart with a falling wedge. Source: ZECUSD on TradingView.com
Zcash (ZEC) chart with a falling wedge. Source: ZECUSD on TradingView.com

However, the ZEC/BTC pair painted a more bearish picture in the past month. ZEC lost 65% against BTC since the exchange rate peaked on May 12. The relative strength index (RSI; purple graph at the bottom) slid to 26, which might reflect the traders’ low trust in the asset next to Bitcoin.

Zcash against Bitcoin. Source: ZECBTC on TradingView.com
Zcash against Bitcoin. Source: ZECBTC on TradingView.com

Considering the upgrades in the Zcash protocol, it might attract more traders in the upcoming month. On the other hand, Bitcoin also looks strong, so that it might keep up the competition. Therefore, while ZEC arrived at a substantial support line on the ZEC/BTC chart (0.00238 BTC), some uptrend might follow.

Also read: China’s crackdown on crypto could backfire, leading to more decentralization, says executive

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