Zcash Privacy Questioned After Arkham Shows It Can Trace Shielded Activity

TL;DR:

• Zcash, known and promoted as one of the most private cryptocurrencies, was called into question after Arkham demonstrated how to track its transactions.
• More than half of the activity on the network can be linked to identified organizations, individuals or entities, according to Arkham Intelligence’s analysis.
• Transparent addresses used by exchanges and institutions expose entry and exit points that blockchain intelligence tools exploit to reconstruct fund flows.

Zcash is considered one of the most sophisticated privacy cryptocurrencies on the market. However, an analysis published by blockchain intelligence firm Arkham Intelligence reveals that more than half of all activity on its network can be identified and linked to known individuals, organizations or entities. The platform claims to have attributed approximately $420 billion in ZEC transaction volume, a figure that stands in stark contrast to the opacity reputation surrounding the protocol.

The explanation behind this analysis does not lie in a cryptographic flaw, but in how the network is built and, above all, in how it is used by its largest participants.

How to Track ZCash Transactions

Zcash is a privacy-focused cryptocurrency built on Bitcoin’s codebase, using zk-SNARKs to hide transaction data on-chain.

Our research team wrote a guide on how Zcash works, why most ZEC activity is still traceable, and how to track it with… pic.twitter.com/87kLo2I0mC

— Arkham (@arkham) May 25, 2026

Nobody Exploits Zcash’s Capabilities

Zcash supports two types of addresses: transparent ones, known as t-addresses, and shielded ones or z-addresses. Transactions between transparent addresses are completely visible on-chain, in a manner identical to Bitcoin. Full cryptographic privacy is only achieved in z-to-z transfers, where the sender, recipient and amounts remain hidden through zk-SNARKs, a zero-knowledge proof system that allows transactions to be verified without exposing the underlying data.

The problem is that the majority of activity on Zcash never reaches the shielded pool. Exchanges, custodians and institutional players prefer transparent addresses for regulatory and compliance reasons. This makes the network’s entry and exit points perfectly visible, which is precisely the kind of data that blockchain intelligence firms exploit.

According to Arkham, shielded addresses remain opaque and only appear labeled as SHIELDED, but the flows surrounding them often reveal enough metadata to trace user behavior.

Cazes, Gemini and the Money Trail

According to the report, Arkham identified in a tracked wallet Zcash funds allegedly linked to Alexandre Cazes, a 26-year-old Canadian citizen arrested in 2017 and identified as the operator of the darknet marketplace AlphaWeb. Separately, the platform identified a trader who reportedly transferred funds to the Gemini exchange weeks after a purchase, turning a $4.49 million ZEC investment into a $6.6 million gain.

The analysis does not imply that Zcash’s privacy is compromised at a technical level. Purely shielded transactions remain cryptographically inaccessible. What the report exposes is a matter of usage: the protocol’s privacy depends less on its architecture than on the discipline with which each user chooses to apply it.