Glossary of Terms

A

Address

A string of characters used to receive cryptocurrency. In Zcash, addresses can be transparent (public) or shielded (private). NozyWallet only uses shielded Orchard addresses for complete privacy.

Argon2

A key derivation function used for password hashing in NozyWallet. Argon2 is designed to be memory-hard and resistant to both GPU and custom hardware attacks.

B

BIP39 (Bitcoin Improvement Proposal 39)

The standard for mnemonic seed phrases. NozyWallet uses 24-word BIP39 mnemonics to generate and recover wallets.

BIP32 (Bitcoin Improvement Proposal 32)

The standard for hierarchical deterministic (HD) wallets. Allows generating multiple keys from a single seed.

Block

A collection of transactions that have been validated and added to the blockchain. Zcash blocks are created approximately every 75 seconds.

Blockchain

A distributed ledger that records all transactions in blocks linked together cryptographically. Zcash uses a blockchain similar to Bitcoin but with privacy enhancements.

C

Commitment

A cryptographic commitment that hides the value and recipient of a transaction while still allowing verification. In Zcash, commitments are used in shielded transactions.

Confirmation

The process of a transaction being included in a block and added to the blockchain. Each subsequent block adds another confirmation.

D

Decryption

The process of converting encrypted data back into readable form. In Zcash, notes are encrypted and can only be decrypted by the recipient using their viewing key.

E

Encryption

The process of converting readable data into an unreadable format. In Zcash, transaction notes are encrypted so only the recipient can decrypt them.

F

Fungibility

The property of money where all units are interchangeable and indistinguishable. Shielded Zcash (ZEC) is fungible because transaction history is hidden.

G

Groth16

A zero-knowledge proof system used in Zcash. NozyWallet uses Groth16 proofs for transaction privacy.

H

HD Wallet (Hierarchical Deterministic Wallet)

A wallet that can generate multiple addresses from a single seed phrase. All addresses are derived deterministically, making backup and recovery easier.

I

I2P (Invisible Internet Project)

A privacy network that provides anonymous communication. NozyWallet can be configured to route transactions through I2P for additional privacy.

Zcash’s next shielded pool (network upgrade NU6.3). Built to restore verifiable circulating-supply soundness after the Orchard circuit issue: seal the old Orchard pool, use a corrected circuit in a new pool, and move value through a turnstile. NozyWallet supports Ironwood scan, migrate, and post-activation sends. See Why Ironwood?.

K

Keystone

Air-gapped hardware wallet supported by NozyWallet for Zcash mainnet Orchard signing. Nozy builds a PCZT; Keystone signs via QR; Nozy broadcasts. See Keystone Hardware Wallet.

Key Derivation

The process of generating cryptographic keys from a master seed or password. NozyWallet uses BIP32 for hierarchical key derivation.

M

MOE (Medium of Exchange)

One of the three primary functions of money. MOE refers to money's ability to be used as an intermediary in trade to avoid the inconveniences of a barter system. Zcash functions as a medium of exchange, allowing users to buy goods and services privately.

Mnemonic Phrase

A sequence of words (typically 12, 18, or 24 words) that can be used to recover a wallet. NozyWallet uses 24-word BIP39 mnemonic phrases.

Memo

An optional text field in Zcash transactions. Memos in shielded transactions are encrypted and can only be read by the recipient.

N

Note

A unit of value in Zcash's shielded pools. Notes contain encrypted information about the amount, recipient, and memo of a transaction.

Nullifier

A cryptographic value that proves a note has been spent without revealing which note was spent. Prevents double-spending while maintaining privacy.

NU 6.1 (Network Upgrade 6.1)

Zcash network upgrade activated at block 3,146,400 (November 23, 2025). Protocol version 170140.

NU 6.3 (Ironwood)

Network upgrade that activates Ironwood: seals the legacy Orchard pool and introduces the Ironwood shielded pool for verifiable supply soundness. Mainnet target height 3,428,143 (2026-07-28). See Why Ironwood?.

O

Orchard

Zcash’s Halo 2 shielded pool used before Ironwood (NU6.3). Orchard hides sender, receiver, and amount. In 2026 a circuit soundness bug was found (see Why Ironwood?); after Ironwood activates, ordinary Orchard activity is sealed and value migrates via turnstile into Ironwood.

P

PCZT (Partially Created Zcash Transaction)

A portable transaction format used for hardware-wallet and multi-step signing. NozyWallet builds and proves a PCZT locally, Keystone adds spend signatures, then Nozy extracts and broadcasts the final v5 transaction.

Privacy

The ability to keep financial information confidential. NozyWallet enforces privacy by default by only supporting shielded transactions.

Proving Parameters

Large parameter files needed to generate zero-knowledge proofs for Zcash transactions. NozyWallet manages the download and storage of these parameters automatically.

S

Shielded Transaction

A Zcash transaction that hides the sender, receiver, and amount using zero-knowledge proofs. All NozyWallet transactions are shielded.

SOV (Store of Value)

One of the three primary functions of money. SOV refers to money's ability to maintain its purchasing power over time. Zcash, like Bitcoin, can function as a store of value due to its fixed supply cap and scarcity. With privacy guarantees, Zcash may offer superior store of value properties as it cannot be "tainted" or blacklisted.

Seed Phrase

See "Mnemonic Phrase"

Spending Key

A private key that allows you to spend notes. Must be kept secret and secure.

T

Tor (The Onion Router)

A privacy network that routes internet traffic through multiple encrypted layers. NozyWallet can be configured to route transactions through Tor for additional anonymity.

Transaction

A transfer of value from one address to another. In Zcash, transactions can be transparent or shielded. NozyWallet only supports shielded transactions.

Transparent Transaction

A Zcash transaction where the sender, receiver, and amount are visible on the blockchain. NozyWallet does not support transparent transactions to ensure complete privacy.

U

UOA (Unit of Account)

One of the three primary functions of money. UOA refers to money's use as a standard measure for valuing goods, services, and assets. ZEC (Zcash) can function as a unit of account, with prices denominated in ZEC. This is particularly useful for private commerce where transactions are hidden but still need a standard valuation.

NozyWallet Documentation