Zcash Rebounds 45% to $448 on Ironwood Pool Proposal as Record 157,931 ZEC Exits Orchard

Zcash News

Zcash recovered sharply over the weekend after founder Zooko Wilcox unveiled a proposal for a new upgrade called Ironwood, designed to restore confidence in the privacy coin's circulating supply. The token plunged late last week after Shielded Labs disclosed a critical bug that could have allowed creation of unlimited counterfeit ZEC before it was patched. Wilcox said Ironwood would let users immediately verify the supply is correct simply by summing the balances of active pools. After cratering to a $5 billion market cap on Friday, Zcash's total value rebounded to nearly $7.5 billion, though it remains roughly 30% below Friday's $10.48 billion peak.

The Zcash Open Development Lab confirmed it is coordinating the Ironwood network upgrade alongside Tachyon, Valar Group, the Zcash Foundation and Shielded Labs. The plan would add formal verification and independent audits to the Orchard protocol, the privacy system that lets users move ZEC without revealing transaction details. Under the proposal, the existing Orchard pool would close to new deposits and internal transactions, forcing funds to pass through a "turnstile" accounting checkpoint before entering Ironwood. Auditors had warned the original flaw could have let attackers mint an infinite amount of counterfeit ZEC undetected, although developers stressed there was no evidence user funds or total supply were affected.

On-chain data flashed warning signs even as the price steadied. Roughly 157,931 ZEC left the shielded pools in a single day on June 5, the largest outflow since early January, as holders pulled coins out of the exact privacy layer the bug targeted. The exodus ignited trading activity: decentralized exchange trades for wrapped ZEC spiked to 17,401 on June 5, the highest in 60 days, before cooling. Centralized spot volume peaked at about $3.76 billion on June 6, far above the 30-day average near $899.5 million, marking a moment of peak stress and repositioning rather than renewed conviction in the network.

The rebound has been dramatic in percentage terms. ZEC bounced roughly 45% from the $300 low it touched Friday, trading near $437 on Monday, even as it remained down about 22% on the week. Developers patched the underlying flaw within days through emergency upgrades. The proposal drew attention well beyond the Zcash community: investor Chamath Palihapitiya described Ironwood as a mechanism for anyone running a node to tally balances across pools and confirm the supply is clean. Developers cautioned that no firm timeline exists, warning the work to build, test and coordinate the upgrade across the network could take longer than expected.

Josh Swihart, founder of the Zcash Open Development Lab, detailed how the team resolved the vulnerability through a two-step emergency response. The first step was a soft fork that disabled Orchard transactions and mitigated exploit risk without revealing the full scope before responsible disclosure. A follow-up hard fork, NU6.2, was activated June 3 to fix the root cause and re-enable Orchard. Mining pools ViaBTC and Foundry played key roles coordinating the response. The disclosure had rattled confidence, driving a more than 50% plunge from around $630 to a $303 low and prompting BitMEX co-founder Arthur Hayes to liquidate his entire ZEC position.

Shielded Labs argued Ironwood may also reveal whether the Orchard bug was ever exploited, although the proposal does not depend on proving the matter retroactively. If users migrate from Orchard to Ironwood and no excess ZEC attempts to leave the old pool, that would be strong evidence the flaw went unexploited; if excess coins try to exit, the turnstile would reject them, preventing counterfeit ZEC from entering the supply. The design sparked debate, with some questioning whether exploitation can be disproven without implying a backdoor. Ripple's former chief technology officer David Schwartz said users who stay in the pool would remain safe regardless, calling the funds accessible if "lonely."

Technically, ZEC trades near $448.44, up 6.29% on the day, but momentum remains mixed. Price sits just above immediate support at $440.81, with deeper floors at $382.26 and $327.43, while the first resistance at $447.15 has been reclaimed, opening the path toward $499.78 and $551.13. RSI near 43.76 sits below the neutral midline, signaling lingering weakness rather than overbought conditions, and the MACD remains bearish within a broadly sideways trend. A daily close above $499.78 would validate the recovery thesis; a break below $440.81, and especially $382.26, would invalidate it and risk a retest of the $327 zone.