ZenIp: 42207
Title: Complete Removal of Shielded Pool from the Horizen Mainchain
Owner: Gustavo Fialho, [email protected]
Comments-URI: https://horizen.discourse.group/t/zenip-42207-discussion/292
Status: Draft
Type: Consensus
Created: 01-04-2024
License: MIT
This ZenIP proposes the complete removal of the shielded pool from the Horizen mainchain. This change builds upon the deprecation path of the shielded pool enacted by ZenIP-42204 and is a response to the evolving regulatory environment around privacy tokens, as well as reflecting the project's strategic pivot away from privacy-focused features.
In light of the shielded pool access deactivation achieved through ZenIP-42204 and the escalating regulatory scrutiny surrounding privacy tokens, the Horizen community have acknowledged the imperative to entirely eliminate the shielded pool from the mainchain. The initial steps in ZenIP-42204 allowed users to transition their funds away from the shielded pool, reflecting a strategic move towards transparency and regulatory compliance. Horizen's evolution from a privacy-centric project to a platform recognized for its cross-chain transfer protocol and the introduction of Horizen EON, an EVM compatible Sidechain, emphasizes this shift.
Maintaining compliance and ensuring our presence on global exchanges necessitate the complete cessation of the shielded pool. This adjustment not only simplifies the network but also brings it into alignment with Horizen's current trajectory and broader ecosystem objectives. The fact that only a residual amount of approximately 26,000 ZEN, representing about 0.18% of the total circulating supply, remains in the shielded pool is indicative of its substantially reduced use. This dwindling figure serves as a compelling reason to finalize the deprecation, ensuring Horizen continues to thrive as a versatile, scalable, and compliant blockchain ecosystem.
The following changes will be implemented at the consensus level:
-
Complete Disabling of Shielded Transactions: All functionalities related to the shielded transactions (z-addresses) will be completely deactivated, preventing any type of transaction related to the shielded pool.
-
Removal of Related RPC Calls: RPC calls specifically related to shielded transactions, such as z_sendmany and z_mergetoaddress, will be deprecated and disabled.
-
Migration Path for Users: A migration path with the necessary tools and guides will be provided to users to move their assets out of the shielded pool before the hard fork. Community support and detailed documentation will be available to facilitate this transition.
-
Network Upgrade: The deactivation of the shielded pool will occur through a network upgrade at a specified block height (TBD). Extensive testing, community preparation, and communication will precede this upgrade.
-
Communication and Timeline: The Horizen team will communicate regularly with the community about the timeline, necessary user actions, and available support resources throughout the transition process.
The complete removal of the shielded pool is a necessary evolution of the Horizen network, reflecting both external regulatory requirements and internal strategic shifts. As Horizen has pivoted away from focusing on privacy, maintaining the shielded pool is no longer beneficial and represents an unnecessary regulatory risk and technical burden. This change will allow the project to focus on its vision of a scalable and versatile blockchain ecosystem while remaining compliant and accessible in the global market.
This change will fully eliminate the native privacy features once offered by the shielded pool on the Horizen Mainchain. Users requiring advanced privacy features are encouraged to look towards other privacy-focused projects that align with their needs. The Horizen team is committed to supporting a secure and compliant ecosystem and will continue to explore privacy-respecting innovations within this regulatory framework.