Is Zephyr safe? Every protocol has risks. Here are Zephyr's, what its rules do about them, and what they can't.
The rules
The Reserve ratio is everything the Reserve holds divided by what it owes in ZSD (the Zephyr Stable Dollar). Four lines on it decide what the protocol allows. They're written into the code, not left to anyone's judgement.
The Reserve is so well backed that new ZRS can't be minted, so today's holders aren't diluted. ZSD can still be minted and redeemed.
ZSD and ZRS can both be minted and redeemed, and every ZSD is over-collateralized, backed by at least $4 of ZEPH.
ZSD still redeems for $1 of ZEPH. New ZSD minting and ZRS redemptions pause, so no new ZSD is issued against a thinner Reserve and Reserve holders can't withdraw their equity: the brakes working as designed. Cheaper ZRS invites new ZEPH in to rebuild it.
ZYS holders stop receiving new ZSD. The yield's share of each block stays in the Reserve as ZEPH instead, helping it recover. The brakes above stay on.
In this extreme case ZSD loses its peg: each redeems for its share of the Reserve instead of a full dollar, and redemptions leave the Reserve no weaker until ZEPH recovers.
Prices use today's Reserve and today's ZEPH price. They show where each line sits, not where ZEPH is going. The chain reads both the ratio and its moving average, so a door can open or close a little after a line is crossed. Watch the Reserve work in the Lab or try your own numbers in the Simulator.
The record
The live figures are loading.
ZEPH from its peak
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From $52.31 on 23 Nov 2023.
Lowest the Reserve has been
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Loading the record.
Days under the 400% line
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On days like these, new ZSD can't be minted. ZSD still redeems, and ZYS still stakes.
Counted from 1 Oct 2023, when ZSD launched. Sources: Zephyr's network statistics until July 2024, then the chain's own price records. The record shows how the rules held through one crash. It isn't a promise about the next.
What can still go wrong
As a stablecoin protocol, Zephyr enforces rules to protect ZSD's backing. There are still risks to be aware of; each one below comes with what limits it. Where nothing does, it says so.
ZEPH, short for Zephyr, is a volatile coin. Everything on Zephyr is built on it: ZSD is backed by it, and ZYS's yield is paid out of its block rewards.
Nothing in the protocol steadies ZEPH's price. The rules protect what ZSD can be redeemed for, not what ZEPH is worth. Only hold what you can afford to see fall.
Every ZSD is covered by ZEPH in the Reserve. If ZEPH fell far enough to take the Reserve under 100%, each ZSD would redeem for its share of the Reserve instead of a full dollar.
New ZSD can only be minted while the Reserve holds at least 4 times what it owes, and ZRS holders take losses first.
ZRS, the Zephyr Reserve Share, is the Reserve's equity. It rises faster than ZEPH when ZEPH rises, and falls faster when ZEPH falls. In a deep fall it can lose most of its value.
That's its job: ZRS takes the swings so ZSD and ZYS don't. Hold it only if you want leveraged exposure to ZEPH.
ZYS, the Zephyr Yield Share, earns 5% of every block's ZEPH, paid as ZSD, so what it pays in dollars follows ZEPH's price. Below a 200% Reserve ratio the yield pauses.
The ZYS rate, how many ZSD one ZYS is worth, has never gone down since launch. Only how fast it grows changes.
The Reserve prices ZEPH from a signed price record that every block carries, and the protocol follows whatever a validly signed record says. That makes the price feed a trust point: a wrong price would be used, not questioned.
Every record is public on the block explorer, so a bad price would be visible, and the code that checks the signature is open source.
Zephyr is a Monero fork with a reserve design added. Any software can hide a bug, and on a blockchain a bug can be costly to fix.
The code is open source and has run on mainnet since 29 May 2023. Open source means anyone can review it; it doesn't mean someone has. The Ethereum (EVM) bridge is going through an external security audit by Sherlock, a third-party auditor.
In 2025 the chain audited every coin. Holders had to move their coins into audited asset types, and coins not audited by the v9 deadline were invalidated. Transfers and conversions were switched off from v8 to v11. Between 7 May 2025 (block 508,000) and 15 Jun 2025 (block 536,000) the ZYS rate held flat while yield kept collecting in the Yield Reserve. Zephyr changes through hard forks, so upgrades can interrupt access again.
It was a planned migration, set out in the release notes, and when it ended the ZYS rate stepped up, taking in the yield that had collected.
Currently, ZEPH trades primarily on 3 exchanges, and its order books are thin. A large buy pushes the price up, a large sell pushes it down, and selling a lot at once can be hard.
Check the live book before you trade, and size your order to what it can take. The Simulator walks it for any amount.
Coins left on an exchange are in its hands. Exchanges can freeze withdrawals, be hacked or fail, and some will ask for ID.
Withdraw ZEPH to your own wallet. Only you can move what's in it, and only you can recover it: if the seed phrase is lost, nobody can restore it.
Rules on privacy coins differ by country and are changing in places. Exchanges in some regions have delisted privacy coins, which could narrow where ZEPH can be bought or sold, or who may use it.
Zephyr is a network no company runs, so a delisting can't switch it off. Once the Ethereum bridge is live, Zephyr's assets can also be bought on decentralized exchanges, where there's no listing to withdraw. Check what's allowed where you live, and keep ZEPH in your own wallet. This isn't legal advice.
The bridge that will bring all four Zephyr assets to Ethereum, as wZEPH, wZSD, wZRS and wZYS, is on testnet and being audited by Sherlock. Bridges are a common target for attacks, and an audit lowers that risk without removing it.
It isn't live, and nothing on it holds real value today. Wait for the audit to be published, and read it, before trusting the bridge with money.
Before you start
Ready to start?
Buy ZEPH first. Convert ZEPH to ZSD in the wallet, then stake it as ZYS. It earns from the next block.
