Zcash activates Ironwood upgrade after counterfeiting concerns

Zcash has activated the Ironwood network upgrade, retiring the Orchard shielded pool and beginning migration of users into a new shielded pool. Developers say the change prevents any potentially counterfeit ZEC from leaving the retired pool and adds quantum‑resistant transaction records.

Orchard’s retired shielded pool held roughly 3.7 million ZEC, about $1.7 billion at current prices. Ironwood introduces a “turnstile” accounting mechanism that limits outflows from the retired pool to the amount that can be proven to have been deposited. According to developers, any counterfeit coins that might exist will remain trapped in the retired pool and cannot enter circulation.

The upgrade follows a May discovery by security researcher Taylor Hornby of a four‑year‑old flaw in Orchard. Hornby used an AI tool during his review. Developers issued an emergency patch in June after the vulnerability surfaced. Because shielded transactions hide their details, there was no way to prove whether the flaw had been exploited before the new accounting rules were put in place.

Ironwood also adds a formally verified proof circuit intended to reduce the risk of similar faults in future code. Developers completed extensive testing in the weeks before the upgrade while exchanges, wallets and mining pools prepared required changes. Network migration began after those preparations were finished.

Market reaction changed after the Ironwood proposal. Following the June emergency patch and the earlier discovery, Zcash had fallen about 38 percent as investors questioned the currency’s circulating supply. News of Ironwood’s proposal led to an estimated $2.5 billion recovery in market value in early June. ZEC now trades near $464, giving it just under an $8 billion market capitalization.

Privacy provider Nym raised concerns that the forced migration could create a temporary privacy risk for users. In a blog post, Nym wrote that under normal use shielded ZEC transactions do not reveal amounts to a wallet server, limiting network exposure, and that Ironwood changes that. The post warned that users who migrate without extra protections could expose information linking their IP address to their wallet balance. Developers have advised users not to rush the migration and recommend using privacy tools such as Tor or NymVPN while moving funds.

Zcash founder Zooko Wilcox proposed Ironwood to close the security gap uncovered in Orchard and to create clearer accounting rules for the network’s circulating supply while preserving shielded transactions for everyday private use.