ZEC up 12% as Zcash nears proof Ironwood has no counterfeit bug

ZEC rose more than 12% on Tuesday after developers working on Zcash's shielded pools said they are close to completing a formal mathematical proof that the Ironwood shielded pool does not allow undetectable creation of coins. The price moved back above $500, its strongest level since early June.

Project Tachyon, the team conducting the verification, outlined new details of its effort to formally check Ironwood’s zero-knowledge proof system. Zcash founder Zooko Wilcox described the work as “on the verge of producing a mathematical proof that there are no undetectable counterfeiting bugs in the latest Zcash shielded pools.”

The verification follows the disclosure last month of a serious flaw in Zcash’s Orchard shielded pool that could have let an attacker create counterfeit ZEC without leaving public evidence. Developers issued a rapid patch and indicated they believe the vulnerability was never exploited. The Orchard design, however, did not allow a full cryptographic demonstration that the flaw could not recur.

Project Tachyon’s focus is Ironwood, the replacement shielded pool intended to address weaknesses found in Orchard. The team aims to produce a formal, checkable argument that Ironwood’s proofs cannot be subverted to produce undetectable inflation. Project Tachyon reported that advances in AI-assisted proof generation have sped parts of the work, automating steps that previously took much longer.

The earlier Orchard disclosure prompted a sharp market reaction: ZEC fell more than 40% over two days in early June. The recent progress on Ironwood coincided with Tuesday’s price rebound above $500.

Former NEAR Protocol contributor Vadim Zacodil compared the risk to Bitcoin’s 2010 inflation bug, when 184 billion counterfeit bitcoins were created briefly before the ledger was rolled back. He pointed out a key distinction: Bitcoin transactions are public and the irregular coin creation was immediately visible, while Zcash’s shielded pools use zero-knowledge proofs that conceal amounts and could make some flaws hard to detect publicly.

Developers say the formal proof for Ironwood remains pending and work continues toward a final, publishable verification.