Grayscale has launched the first U.S. exchange-traded fund with direct exposure to Zcash, trading under the ticker ZCSH on NYSE Arca. The fund converts Grayscale's existing Zcash Trust and carries a 2.5% annual sponsor fee, and it arrives as ZEC rallies to fresh highs.
Grayscale began trading the first exchange-traded fund offering direct exposure to Zcash on Tuesday, listing the fund under the ticker ZCSH on NYSE Arca. The privacy coin fund gives investors access to ZEC through a regulated exchange-traded product without requiring them to hold the cryptocurrency directly.
Fund converts Grayscale's existing trust
The ETF is a conversion of the Grayscale Zcash Trust, which Grayscale sought to list on NYSE Arca through a Form S-3 registration filed with the SEC in May. Its fifth amended filing, submitted before the weekend, set the annual sponsor fee at 2.5%. A Grayscale spokesperson said fee revenue will go back into the Zcash ecosystem to support network development and marketing.
Before the conversion, shares traded on the OTCQX market, and the trust held more than $313.5 million in assets under management as of Monday, according to Grayscale figures cited by The Block. Authorized participants can now create and redeem shares, an arbitrage mechanism designed to keep ZCSH's trading price close to the net asset value of the ZEC it holds. Coinbase Custody Trust Company serves as custodian, and Bank of New York Mellon handles administrative functions.
ZEC extends its rally
Zcash has gained about 45% over the past several days ahead of the ETF launch, according to The Block's price data. Coinpedia separately put the weekly rise at 65% as institutional activity increased before the listing. The token also reached a yearly high of $850 and is now up over 60% year-to-date.
The advance follows a volatile year for ZEC. The token climbed above $600 in May, then fell from around $644 on June 4 to near $309 by June 5 after developers disclosed a vulnerability in Zcash's Orchard shielded pool that could theoretically have allowed undetected counterfeit ZEC. No funds were reported stolen, and developers patched the flaw through the NU6.2 hard fork before replacing Orchard entirely with the Ironwood upgrade on July 28.
Privacy demand linked to AI
Crypto investor Cameron Winklevoss, who backs the ZEC treasury firm Cypherpunk, tied the rally to artificial intelligence. According to CoinGape: "If you are bullish on AI then you are bullish on Zcash." The comments follow the SEC's decision to close its investigation into the Zcash Foundation in January without recommending enforcement action, ending a probe that began after an August 2023 subpoena.
The Zcash listing extends a conversion strategy Grayscale has already used for its Bitcoin and Ethereum trusts, and the asset manager has since expanded its lineup to include XRP, Solana and Litecoin.
Sources: crypto.news, CoinGape, Coinpedia Fintech News
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