Here's the current main differences:
Proof of Stake instead of Proof of Work algorithm so anybody can easily earn block rewards without special mining hardware or wasting electricity, BTC2 started with Bitcoin's addresses and balances, BTC2 supports more transactions per second, transactions confirm faster, swift transactions feature provided by masternodes that can confirm transactions within seconds, before they appear in a block.
Maybe correct, but that doesn't mean ZCoin won't make any further progress. They have a pretty strong development team and will keep up with most recent advancements or even set new precedents.