Zcash AI Bug Crisis Over? Cofounder Shares Update Amid Unexpected Positive

Zcash cofounder Bryce Wilcox-O’Hearn (Zooko Wilcox), who goes by Zooko on X, revealed that Zcash just gave away more than $8 million in retroactive grants, including millions of dollars to those who selflessly worked to protect users during the AI bug crisis this year.

Along these lines, Zcash retroactively self-funded $1.5 million to the researcher who found and disclosed the Orchard bug via a permissionless coinholder vote administered by a Zcash non-profit.

The researcher here refers to Taylor Hornby, a security engineer engaged by Shielded Labs in April 2026 specifically to identify protocol vulnerabilities before malicious actors could. Working with Anthropic’s AI model, Hornby conducted a highly targeted review of the Orchard circuit, the cryptographic system underpinning Zcash’s most advanced privacy pool, and discovered an undetected vulnerability that, if exploited, could have allowed an attacker to create an unlimited number of counterfeit ZEC tokens.

This incident spurred developers and community members to prioritize user protection and network security. Consequently, the Zcash Ironwood Upgrade (NU6.3) was activated on July 28, 2026, to seal the vulnerable Orchard shielded pool and resolve the four-year-old counterfeiting bug.

Zcash cofounder names unexpected positive

With the storm behind them, the Zcash cofounder pointed to an unexpectedly positive development for the privacy-focused blockchain and its community in the aftermath of the AI bug crisis.

The cofounder highlighted the broader governance mechanism behind the retroactive grants, with the process demonstrating Zcash‘s ability to fund contributors retrospectively.

“The best thing is: Zcash proved once again that it is a sustainable, capture-resistant, and evolving system of self-funding and self-governance,” Zooko wrote.

In a similar development, Zcash coinholders have approved ZODL’s retroactive grant, which requested $1,950,000 for Q1–Q2 core protocol work. Over that period, 10 major vulnerabilities were remediated alongside advanced post-quantum and consensus specifications, and 162 PRs were merged.

In a separate milestone, more than 4 million ZEC, nearly $5.8 billion, is now secured by Ironwood.