Zcash (ZEC) pulled back on Monday after surging to an eight-year high, as traders digested a landmark regulatory filing by Grayscale to convert its Zcash Trust into a US spot exchange-traded fund. The privacy coin rose past $880 on August 23 before easing to around $814, still up roughly 66% over the week before the retreat. Its market capitalization stood near $13.7 billion, placing ZEC at number 11 among tokens ranked by market value.
The rally ignited after Grayscale submitted an amended registration statement to the Securities and Exchange Commission. The asset manager wants the Zcash Trust listed on NYSE Arca under the ticker ZCSH, with shares expected to begin trading on or about August 25 if regulators sign off. The filing could create the first US ETF tracking a privacy-focused cryptocurrency, an asset class regulated products have largely avoided. Zcash uses zero-knowledge cryptography to hide transaction sender, recipient, and amount information, making it attractive to privacy advocates but a concern for regulators focused on money laundering and sanctions evasion.
Grayscale's filing also disclosed non-binding talks under which DCG International Investments, a Digital Currency Group subsidiary, could seed the fund with 200,000 ZEC, worth roughly $110 million at the cited valuation. The trust held about $263.5 million in assets as of August 21. Market activity surged alongside the price move: open interest in ZEC perpetual futures nearly doubled from $962.5 million on August 19 to $1.8 billion by Monday, while 24-hour volume reportedly hit $5.3 billion. The average eight-hour funding rate of 0.0106% signaled that traders were paying up to stay long. Influencer @TheFlowHorse added to community momentum by encouraging traders to "set bids and set sail."
Separately, Zcash faces a governance catalyst: a community vote on the NU7 upgrade, organized by Valar Group and Project Tachyon, opens August 25 and runs through September 14. Eligibility was set by shielded ZEC held in the Ironwood pool at a snapshot around 19:00 UTC on August 24. The ballot could reshape Zcash's issuance schedule. Broader crypto markets also rallied, with Bitcoin trading near $80,000 after a Treasury bond-buyback announcement and short liquidations, while Bitcoin and Ethereum posted double-digit percentage gains.
