Zcash activates Ironwood and seals Orchard pool holding 3.66 million ZEC

Upgrade closes old pool

Ironwood, formally designated NU6.3, retires Orchard as Zcash’s previous shielded pool. Shielded pools are the privacy layer of the network, where transaction amounts and participants are hidden while zero-knowledge proofs attest that deposits are properly reflected onchain.

At the moment Ironwood activated, the new pool held zero ZEC. Any funds users want to keep in the updated pool must be moved by their owners. The transition is not automatic, meaning the pace of migration will depend on user action rather than the protocol moving balances itself.

Bug found after four years

The upgrade comes after Shielded Labs researcher Taylor Hornby found on May 29 that Orchard’s proof circuit contained a bug that could have allowed an attacker to mint counterfeit ZEC without leaving an onchain trace. According to the source report, the flaw had existed since Orchard launched in May 2022.

Developers patched the issue within days of its discovery. Even so, the patch could not retroactively resolve the uncertainty created by the years during which the flaw was live. Because zero-knowledge proofs reveal only the facts necessary to verify a transaction, the blockchain itself cannot show whether any counterfeit coins were ever created inside Orchard.

Evidence remains inconclusive

The report said available evidence points away from exploitation, though it does not prove none occurred. One reason cited is that Orchard’s balance continued to rise over the years the bug was present, including during last year’s rally, a period when selling any illicitly created coins might have been expected to be most attractive.

Still, the network cannot conclusively rule out the possibility that counterfeit ZEC was minted and remains inside the old pool. That uncertainty is what Ironwood’s new accounting rule is designed to address.

Turnstile limits withdrawals

Under Ironwood, the only way funds can leave Orchard is through what developers describe as a turnstile. This rule caps total withdrawals from the old pool at the amount that can be publicly verified as having been deposited into it.

Since transfers into and out of a shielded pool are visible even if activity within the pool is private, the network can enforce that ceiling. If counterfeit ZEC does exist inside Orchard, the turnstile is intended to keep those coins trapped there by preventing total outflows from exceeding legitimate inflows.

As of press time, 1,500 ZEC had already been transferred into the new pool.

New safeguards in Ironwood

Ironwood also introduces protections that Orchard did not have. One is a chain record for each coin designed to remain recoverable if future quantum computers break the cryptography currently securing the network. The source article said this property is specified under ZIP 2005 and applies from the first block of the new pool.

The second is formal verification of the pool’s proof circuit. Rather than relying only on conventional testing, formal verification aims to produce a mathematical proof that software behaves correctly in every possible case, with the stated goal of eliminating the kind of flaw found in Orchard.

ZEC was trading near $463 ahead of the switch, down 8% on the day and 15% over the week, though still up roughly tenfold over the past year. For now, the key issue is how quickly the 3.66 million ZEC in Orchard migrates, since most of Zcash’s private supply remains in a pool that can no longer accept new funds.