- Zcash (ZEC), one of the world’s top privacy-focused cryptocurrencies, crashed by nearly 60% over the last week upon disclosure of a major vulnerability in its network.
- While many investors bore the brunt of its price collapse, an individual who gained notoriety during last year’s 10/10 crash appeared to have profited from the event.
The Recent Zcash Crash
Zcash has already recovered significantly after the flash crash over the past week, which brought its token from a $637 to $258 valuation in a single red weekly candle on the charts. Nonetheless, the bad publicity stemming from a longstanding vulnerability continues to linger despite the issue already being patched up.
Taylor Hornby, a security researcher at Defuse Security and board member at Zcash, reported on May 29 that the chain powered by ZEC had a hidden vulnerability that had remained undetected for four years. The bug would have allowed unlimited minting of counterfeit ZEC tokens within the Orchard protocol.
Shielded Labs, the development organization behind Zcash, immediately acted upon the exposé. It immediately deployed an emergency fix followed by an ecosystem-wide remediation within the next two days.
Zooko Wilcox, founder of Zcash, and Jason McGee, Executive Director at Shielded Labs, corroborated Hornby’s findings. The confirmation later triggered a cascade of ZEC liquidations as the topic gained significant traction in the crypto community. It only amplified the ongoing crypto market-wide drawdown catalyzed by Bitcoin’s (BTC) drop below $60K and macro headwinds.
Detection of Zcash’s Weak Spot
According to Hornby, Wilcox, and McGee, Zcash’s vulnerability has been dormant since the chain launched its Orchard protocol in May 2022. Due to the platform’s privacy-focused design, neither the security researcher nor the top management of Zcash and Shielded Labs could determine whether someone had exploited the vulnerability in question at any point before the latest patch.
The Orchard protocol is the most advanced zero-knowledge (ZK) layer of the Zcash chain. It unlocked highly scalable, private transactions on the network. The lack of cryptographic proof about its long-hidden vulnerability, though, primarily caused many people to panic-sell their ZEC holdings.
Shielded Labs reportedly engaged Hornby’s expertise around April 2026. The security researcher’s job was to detect potential vulnerabilities before hackers could find and exploit them. He then proceeded with the task using artificial intelligence (AI) tools.
Things took a turn when Anthropic updated to Claude Opus 4.8 by the end of May. The upgrade enabled Hornby to write a complete exploit, taking advantage of Orchard’s under-constrained state.
The condition generally enabled one to put arbitrary false inputs into an elliptic curve multiplication and still have the multiplication check pass. Next, the cybersecurity expert later rolled out the exploit in a local regtest environment to test his theory.
Hornby found that the chain was indeed exploitable via Orchard’s vulnerability, which could have led to an unlimited supply of counterfeit ZEC tokens.
10/10 Profiteer Strikes Again Amid the Zcash Drama
Most investors are still reeling from the alarming revelation centering on Zcash. On the other hand, Garrett Jin, former CEO of Bitforex, had interestingly placed a huge bet against ZEC before its huge price dump.
Jin’s position revealed that he shorted 57,460 ZEC prior to the event at $626 with 3x leverage. The immediate fallout of the catastrophic Zcash crash elevated his leveraged position to approximately $21.5 million in unrealized gains. He eventually closed his short on Sunday, cashing out $11.24 million along the way.
The former Bitforex CEO has been gaining plenty of notoriety lately, especially at the height of the 10/10 incident last year.
Garrett Jin’s Other Suspected Insider Trading Bets
In October 2025, US President Donald Trump notably sent crypto prices into a meltdown as he intensified the tariffs against China. During that time, he slapped President Xi Jinping’s nation with 100% tariff on top of its existing 30% duties on Chinese goods.
Trump’s decision came in response to China’s strict restrictions on rare earth exports, which threatened the American tech sector. The US president called his Chinese counterpart’s move “extraordinarily aggressive” and an “extremely hostile letter to the world.”
The escalation resulted in over $19 billion in liquidation in Bitcoin and other cryptocurrency positions. It put the brakes on what could have been a bullish event amid anticipation of a Uptober bull run.
One particular trader appeared to have pocketed between $150 million and $200 million in the ensuing market panic. It’s worth noting that the individual’s shorts in Hyperliquid (HYPE) occurred just in time before Trump’s big tariff announcement, which sparked suspicions that the same trader may have had access to insider information.
The public initially accused the president’s son, Baron Trump, of orchestrating the hundred-million-dollar short. However, Jin stepped up to claim the trade while denying any involvement with the Trump family or having insider knowledge within the White House.
But then again, some members of the crypto community detected a successful prediction on Polymarket during the same month, which allegedly traced back to Jin. The anonymous trader, suspected to be Jin, pocketed $56K following an accurate forecast of former Binance CEO Changpeng “CZ” Zhao’s pardon from Trump.
The amount was merely chump change compared to the hundreds of millions of dollars Jin earned from 10/10, but many believe that a series of circumstantial evidence all point in the crypto personality’s direction.
