- Grayscale pushes Zcash toward a spot ETF as rising demand strengthens the case for a regulated ZEC product.
- ZEC climbs in value as investors track the ETF filing and respond to strong market interest in privacy assets.
- The Zcash ETF plan faces supervisory challenges as regulators monitor zero knowledge features and liquidity risks.
Grayscale has filed an S-3 registration statement with the U.S. SEC to convert its Zcash Trust into a spot Zcash ETF. The move positions ZEC as one of the first privacy-focused assets aiming for a regulated ETF structure. The filing adds new pressure on the SEC as interest in privacy tokens rises again.
Streamlined Filing Supports Faster ETF Transition
The filing outlines plans for an ETF that holds real Zcash and tracks the CoinDesk Zcash Price Index. The S-3 form offers a faster path because it supports conversions from existing trusts. Grayscale meets the requirements due to its market size and long reporting history. Its previous transitions with Bitcoin and Ethereum trusts in 2024 also set a clear path for this product.
Additionally, the proposal includes a 19b-4 rule change. This step would allow NYSE Arca to list and trade the ETF once it receives approval. NYSE has supported two other Grayscale ETF listings this year, which strengthens expectations for regulatory progress. The trust currently holds about $150 million in ZEC, which would shift into the ETF once the SEC clears the process.
Rising ZEC Interest Strengthens ETF Case
Demand for Zcash continues to rise as global investors seek assets that offer stronger privacy features. Reliance Group recently moved its entire crypto portfolio to ZEC. This shift helped direct attention toward Zcash and added momentum to Grayscale’s proposal. The ETF would allow in-kind creations and redemptions using baskets of ZEC, which aligns with the structure of most U.S. spot ETFs.
The planned sponsor fee stands at 2.5% annually. Once listed, the ETF could reach new regions and expand access for investors who prefer regulated platforms. The design mirrors current spot ETF standards, which signals Grayscale’s effort to align ZEC with familiar market frameworks.
ZEC Price Climbs As Investors Track ETF Progress
ZEC continues to respond to increased market interest. The token is trading around $509 after a modest rise in the past 24 hours. Strong demand has pushed ZEC into the top fifteen cryptocurrencies by market capitalization. Investors now track both price momentum and the regulatory steps that may influence trading volumes.
The filing also highlights risks linked to privacy assets. Zcash uses zero-knowledge proofs to protect transaction information. Regulators often monitor these features because they can limit visibility for compliance checks. Small trades may also move ZEC’s price more than usual due to its lower liquidity compared with larger tokens. The filing notes that these market traits could create sharp price changes during periods of high activity.
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