Zcash Surges $1-2.5 Billion in Market Cap Following Founder's 'Ironwood' Supply Audit Proposal

Jun 7, 2026

Zcash founder Zooko Wilcox has proposed an 'Ironwood' upgrade to restore confidence after a critical bug allowed for potential infinite token creation. The vulnerability, which is impossible to verify due to privacy features, caused ZEC's market cap to crash to $5B before recovering by $2.5B following the proposal. The plan aims to solve a core tradeoff between privacy and supply auditability for the coin.

Zcash Ironwood supply audit proposal

▪The Ironwood plan involves isolating the old Orchard pool, implementing a "Turnstile accounting" system, and launching a new protected pool.
▪Zcash founder Zooko Wilcox proposed an "Ironwood" upgrade to restore confidence in the privacy coin's supply.
▪The Ironwood upgrade would allow users to verify that Zcash's circulating supply is correct by summing the balances of active pools.

Zcash counterfeiting vulnerability disclosure

▪Due to Zcash's privacy features, it is cryptographically impossible to determine whether the counterfeiting vulnerability was ever exploited.
▪Following the vulnerability disclosure, Zcash's market cap cratered to $5 billion from a recent peak of $10.48 billion.
▪Shielded Labs disclosed a critical vulnerability in Zcash's Orchard shielded pool that could have allowed for the creation of unlimited counterfeit tokens.

Zcash market cap recovery

▪After the Ironwood proposal, Zcash's market cap recovered by approximately $2.5 billion to nearly $7.5 billion.
▪The recovered market cap of $7.5 billion remained about 30% below its recent peak of $10.48 billion.

Privacy coin auditability tradeoff

▪Ripple CTO Emeritus David Schwartz stated that if the bug was not exploited, user funds would remain safe and accessible in the old, deprecated pool.
▪The crisis highlighted a core tradeoff for privacy coins between ensuring user privacy and allowing for supply auditability.

Crypto market volatility context

▪A separate rally on May 6, catalyzed by an investment from Multicoin Capital, saw ZEC's market cap increase by $1 billion in under 24 hours.
▪Helius Labs CEO Mert Mumtaz called the proposed Ironwood upgrade "extremely bullish," describing it as an ambitious response to the issue.