What is a Zcash Shielded Asset (ZSA)?

ZEC is the unit of transfer on the Zcash network. A Zcash Shielded Asset, or ZSA, is something other than ZEC that lives in Zcash's shielded pool: a postcard, a certificate, a membership, a token.

The important word is shielded. A ZSA gets the same privacy as shielded ZEC: who sent it, who received it and what it was are encrypted on the chain. Only the people holding the right keys can read them.

1. Why it matters

On most blockchains, an asset is public by design. Anyone can look up which address holds which item, what it paid, and everything else that address has ever done. Collecting something there means publishing your collection.

A shielded asset turns that around. The issuer can be public, so you know who created it. Each holder after that stays private.

2. Two ways to build one

There are two ways to put an asset into Zcash's shielded pool.

• Native, or layer one (L1). Zcash's own rules would learn about assets. This is proposed in ZIP 226 and ZIP 227. The network would track each asset and balance its supply the way it balances ZEC. It needs a network upgrade and is not active on Zcash mainnet.
• Built on top, or layer two (L2). The asset rides inside an ordinary shielded ZEC note, using only what Zcash already provides. Nothing in Zcash changes, so it works today. This is what Zecboat uses. See What is an L2 ZSA?.

3. What they have in common

Either way, a shielded asset:

• is private by default: no public list of holders;
• can be disclosed selectively with a viewing key, just like shielded ZEC (see What is a Zcash Viewing Key?);
• lives in the same wallet as your ZEC.

The short version

A ZSA is an asset that is not ZEC but is just as private as shielded ZEC. Native ZSAs are a proposal waiting for a network upgrade. Layer-two ZSAs, like Zecboat's Collections, are on Zcash mainnet now.