ZEC Crashes 38% as Zcash Discloses ‘Critical Counterfeiting Vulnerability’
Zcash fell sharply after developers disclosed a critical vulnerability in the Orchard shielded pool that may have enabled undetectable counterfeiting for more than four years. The price dropped from about $635 to a low near $309, then recovered slightly. The bug, found on May 29 by security researcher Taylor Hornby with AI-assisted tools, was in two lines of code in the Orchard circuit and could have let an attacker mint counterfeit ZEC inside the shielded pool without an on-chain trace. It existed from Orchard’s launch in May 2022 until an emergency fix on June 1, 2026, and there is no cryptographic way to prove whether it was exploited. The incident intensified concern about privacy coins, where successful exploits may remain invisible. Critics argued the broader design risk persists even after this fix, while others said real exploitation seems unlikely. Arthur Hayes said he sold his Zcash holdings. Shielded Labs proposed a new shielded pool with turnstile accounting and formal verification to improve supply integrity and limit legacy risk.
