The price of privacy-focused cryptocurrency Zcash (ZEC) remains trapped in a prolonged consolidation phase, despite significant accumulation by large investors and renewed institutional interest in privacy coins. According to on-chain data, mega whale wallets increased their ZEC holdings by approximately 21% over the past week, representing a net accumulation of roughly $3.3 million (38,626 ZEC at current prices).
This whale activity, however, has been offset by opposing retail behavior. Exchange inflows surged by about 78%, indicating smaller holders are selling into recent strength, which has seen ZEC rise 25% month-on-month. This tug-of-war between buyers and sellers has kept ZEC trading within a symmetrical triangle pattern since mid-October, characterized by lower highs and higher lows that reflect market indecision.
Technical indicators mirror this stalemate. The Bull–bear power (BBP) metric shows momentum flipping between bulls and bears, while the Smart Money Index has slipped below its signal line, suggesting reduced confidence in a near-term upside breakout. For a decisive move, ZEC needs a daily close above $561, which is about 14% above current levels and would break the upper trendline of the triangle.
Compounding the technical compression is a collapse in market sentiment. The positive sentiment score for ZEC has plummeted from around 151 to near 2 over the past month. Historically, ZEC has rallied strongly on sentiment spikes—a surge above 150 in early December preceded a 34% price jump from $345 to $464 in less than a week.
A key factor delaying ZEC's breakout is its negative correlation with Bitcoin. Data shows a short-term correlation of approximately -0.36 with BTC. As Bitcoin reclaims key levels and attracts capital—up almost 4% week-on-week—ZEC demand weakens at the margin, with ZEC giving back 7% of its gains over the same period.
Meanwhile, a separate report highlights a strategic shift among some long-term Bitcoin whales who are now accumulating ZEC. Trader Huang noted on X that these are not short-term traders but holders seeking "exposure and optionality," viewing ZEC as potentially underpriced relative to its role. This view is supported by a sharp rise in Zcash's shielded supply, which indicates coins are being moved into privacy-protected addresses for longer-term holding rather than quick trading.
Zcash's optional privacy feature, unlike the mandatory privacy of some competitors, is seen as giving it more flexibility amid tightening regulatory scrutiny, potentially making it more palatable for institutional consideration. This has reopened conversations about privacy coins in general, though no major institutional rush is currently evident. The current phase is characterized by quiet, steady accumulation rather than hype, positioning the asset for a potential re-rating if broader market demand materializes.
