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There has been growing controversy over new cryptocurrency Zcash since the tweet by Edward Snowden suggested that it will encourage tax protests.
There has been growing controversy over new cryptocurrency Zcash, since a tweet by Edward Snowden suggested that it will encourage tax protests.
Snowden’s tweet was attached to a post by The New York Times, where Zcash was described as a “harder-to-trace virtual currency.”
Snowden wrote in regard to the article:
“Coincidentally, new technologies raise the possibility of unstoppable tax protests.”
Created by computer scientists at Johns Hopkins University and Massachusetts Institute of Technology, Zcash has been claimed to have secured $3 mln in backing from Silicon Valley venture capitalists, and its developers claim to have used advanced cryptography to create the virtual currency.
Rather than coming forward as a privacy purposed entity with ulterior intentions, as has been interpreted from Snowden’s comment, the CEO of Zcash, Zooko Wilcox, describes the functionality of the cryptocurrency as “selective disclosure.”
Wilcox says that this characteristic of Zcash makes it possible for businesses to conceal their private transaction details from competitors, thieves and foreign enemies, while simultaneously disclosing that information to their country's tax authority.
However, Wilcox explains that he understands Snowden’s line of thought as it applies to other cryptocurrencies.
“I can also see where Edward Snowden is coming from. New technologies like Bitcoin, Ethereum and Zcash could be used to evade taxes. Similarly, cash and the conventional banking system are used that way. I just don't think that's going to be the predominant use, at least not in well-governed countries with the rule of law.”
Wilcox also states that like the automobile, cash, Bitcoin, Ethereum and the conventional banking system, Zcash may turn out to have some illegal uses, but vastly more legal uses.
“As our economy digitizes and evolves, more and more of the productive, employment-providing, tax-paying businesses will leverage these new technologies.”
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