Zcash activated its Ironwood upgrade on Tuesday, retiring the Orchard shielded pool that holds about 3.66 million ZEC and opening a replacement pool that started with zero coins. A bug in Orchard's proof circuit, live for four years, could have let an attacker mint counterfeit ZEC without leaving an onchain trace. The only route out of Orchard is now a turnstile that caps withdrawals at the amount verifiably deposited.
Zcash activated its Ironwood upgrade at block 3,428,143 on Tuesday, sealing the shielded pool that holds most of the network's private funds and opening a migration into a pool that starts from zero tokens. Ironwood, formally known as NU6.3, retired the previous pool, Orchard, which holds about 3.66 million ZEC — worth roughly $1.7 billion at current prices.
Shielded pools are the private side of Zcash, where the amounts of coins and the participants are hidden. Ironwood held zero ZEC at activation, trackers showed, and every coin has to be moved across by its owner through a turnstile — an accounting rule at the pool's boundary that caps total withdrawals at the amount verifiably deposited.
A counterfeiting bug that sat open for four years
Shielded Labs researcher Taylor Hornby found on May 29 that Orchard's proof circuit contained a bug that would let an attacker mint counterfeit ZEC with no onchain trace, a flaw live since Orchard launched in May 2022. But evidence points away from exploitation, a CoinDesk Research report found in July.
Selling counterfeit coins would have shown up as funds leaving the pool. Instead, Orchard's balance grew steadily through the four years the flaw was open, including through last year's price rally, when cashing out would have been most profitable.
Why the turnstile exists
Developers patched the bug within days, yet the patch could not account for the four years it was open. Because a zero-knowledge proof reveals nothing beyond the facts it verified, the chain holds no record of whether any Orchard transaction actually moved, and nobody can prove counterfeit coins were never created.
Money crossing into or out of a shielded pool is public even when the transactions inside are not. Therefore the network already knows how much ZEC went into Orchard and will not release more than that, leaving any counterfeit coins stuck inside.
Two protections Orchard never had
The record each coin leaves on the chain is built to stay recoverable if quantum computers eventually break the cryptography now securing it, a property specified under ZIP 2005 and in place from the first block. The pool's proof circuit, the code that checks every private transaction is valid, is also undergoing formal verification, which produces a mathematical proof that software behaves correctly in every possible case rather than only in the cases a tester thought to try.
ZEC traded near $463 ahead of the switch, down 8% on the day and 15% over the week, though it remains up roughly tenfold over the past year. As of press time, 1,500 ZEC had moved into the new pool, according to a tracker.
How fast the 3.66 million ZEC actually moves is the number to watch, and migration is voluntary and user-driven.
Source: CoinDesk
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