Zcash vulnerability triggers market plunge and raises privacy risk concerns

Security researchers used an advanced AI model to uncover a four‑year‑old critical flaw in the Zcash privacy‑coin protocol. The bug, which had gone undetected for half a decade, was patched after disclosure.

The revelation caused Zcash's price to tumble by about 33%, falling to roughly $350, its lowest level in over a month. Analysts highlighted the trade‑off between Zcash's strong privacy features and the difficulty of auditing the supply of coins, noting that similar bugs had previously affected other privacy‑focused crypto projects.

Experts warned that such hidden vulnerabilities could spill over into broader financial markets, especially as institutions integrate tokenized assets. The episode also underscored how AI tools are making cryptographic bugs easier to discover, raising both security opportunities and new threat vectors for the crypto ecosystem.