What to know:
- Zcash Ironwood aims to let users verify ZEC supply through active pool balances.
- A new shielded pool would fix the Orchard flaw and block outputs in the old Orchard pool.
- Turnstile rules could stop excess ZEC and reveal if the Orchard flaw was exploited.
Zcash Ironwood has been proposed as a network upgrade to help users verify ZEC’s circulating supply after a critical Orchard flaw. Shielded Labs introduced the plan with several Zcash groups. The proposal follows an emergency upgrade completed on June 2.
The announcement is connected with a counterfeiting vulnerability in the Orchard shielded pool. The June 2 emergency upgrade fixed that vulnerability, said developers. The new plan is to allow supply verification by regular users with Zcash nodes.
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Zcash Ironwood Sets Supply Verification Rules
The proposal would allow users to verify supply through the sum of balances of active pools in Zcash Ironwood. This ability would begin immediately after activation. Users would no longer have to depend on external reviews for determining the correctness of the circulation ZEC.
The upgrade will result in a new shielded pool utilizing the Orchard circuit. That pool would include the fix for this recently discovered vulnerability. It would also refuse any transaction that attempts to create outputs in the old Orchard pool.
Funds already held in the existing Orchard pool would not be erased. After activation, however, Zcash Ironwood would limit the movement of those funds. They can only leave the platform through Zcash’s turnstile accounting system, which is restricted by transfers from recorded inflows.
The design would enable supply integrity throughout the network, the proposal states. Within limits, legitimate balances may be transferred from the affected pool. The turnstile mechanism would prevent any excess amount from escaping.
Zcash Ironwood Adds On-Chain Exploit Checks
Zcash Ironwood could even generate public proof of whether the vulnerability was exploited. The proposal stated that this is not the primary intent of the upgrade. However, fund migration might indicate if there is any unbacked ZEC that tries to leave the old pool.
That would present a stark decision for a potential counterfeiter. They could try to move fake ZEC and risk detection. They may also leave those funds behind, which will continue to have no impact on the verified supply.
Developers stated that if no surplus ZEC were trying to leave the old pool, it would be a good sign that there is no attempt to exploit. If excess funds attempt to move, turnstile rules would stop them. That would give us clear on-chain evidence of the problem.
For wallets, those that support Orchard would have to add compatibility with the new shielded pool. Orchard addresses would continue to be valid post activation. Once Zcash Ironwood is active, new incoming funds will automatically flow to the secure pool.
Zcash Ironwood is still in the process of development, testing, review, and ecosystem coordination, the developers said. Migration could show transfer timing and amounts and have limited privacy trade-offs. The conversion of legacy zcashd to Zebra might also complicate the upgrade schedule.
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