ZEC -1.16% as Grayscale Files for First U.S. Zcash ETF

Grayscale Investments has filed with the U.S. Securities and Exchange Commission to convert its Grayscale Zcash Trust into a spot Zcash (ZEC) exchange-traded fund (ETF). If approved, the ETF will trade under the ticker symbol ZCSH on NYSE Arca, marking the first U.S.-listed ZEC ETF and the first Zcash product available to traditional and institutional investors. The filing includes Coinbase Custody as the custodian and Coinbase as the prime broker, with The Bank of New York Mellon serving as transfer agent and administrator.

As of November 25, the Grayscale Zcash Trust held approximately 394,400 ZEC, valued at around $199.2 million. The firm has previously demonstrated a successful track record in converting its trusts into ETFs, such as the recent approval of its Dogecoin Trust, which transitioned to an ETF in about three months.

The timing of this filing aligns with a notable rise in ZEC’s price over the past several months. ZEC has experienced a 28.74% increase in the last 30 days and an 825.75% surge over the past 12 months.

Analysts attribute this growth to rising institutional and retail interest in privacy-focused cryptocurrencies. Zcash's unique architecture, which combines Bitcoin-like security with optional privacy features, has drawn attention as a compliance-ready digital asset for institutional portfolios.

Alongside Grayscale's initiative, Reliance Global Group (RELI) has also expanded its exposure to Zcash. On November 26, the company announced an increased investment in ZEC through its Digital Asset Treasury (DAT) strategy. Reliance cited ZEC’s Bitcoin-based security model and optional privacy features as key reasons for its strategic allocation. The firm emphasized that ZEC’s architecture supports its compliance-oriented approach to digital assets. The move reflects confidence in the long-term value of Zcash as a privacy-preserving asset.

Templar Protocol also made a notable advancement in ZEC utility by enabling the first native ZEC borrowing. The protocol allows users to lock native ZEC as collateral to borrow stablecoins on Solana without wrapping or bridging the asset. The process leverages NEAR Intents and Chain Signatures to execute cross-chain actions securely. Templar’s isolated market model, which separates collateral and borrowed assets, limits contagion risk and allows for better loan-to-value ratios compared to pooled lending structures. The firm plans to expand its privacy features, including shielded borrowing and advanced encryption techniques.

ZEC’s recent price performance has been volatile, with a 5.4% drop over the last seven days despite a 5% increase on November 26. The token has faced short-term downward pressure but remains within a broader upward trend. Some analysts warn that the price could face further downward momentum if market sentiment shifts or if the ETF approval process encounters delays. However, others argue that the structural demand for privacy tokens remains strong, particularly among institutional investors seeking diversified exposure.

Grayscale’s filing underscores a growing recognition of Zcash’s potential in mainstream finance. The firm’s legal team highlighted ZEC’s role in a well-balanced digital asset portfolio and emphasized its importance in the evolving regulatory landscape. The ETF’s conversion process may take several months, and the final structure will likely remain limited to cash-based share creation and redemption until further regulatory clarity is achieved.

In summary, the Grayscale Zcash Trust’s potential conversion into a spot ETF represents a milestone for ZEC adoption in traditional markets. Combined with Reliance’s strategic treasury allocation and Templar’s new borrowing feature, these developments highlight the increasing integration of Zcash into institutional and regulated financial systems. Investors and market participants will continue to monitor the SEC’s review process and ZEC’s price trajectory as the asset gains further legitimacy in the broader investment ecosystem.