Zcash (ZEC) 'Jumps' 19-fold in 1 Year..."Swallowing Bitcoin (BTC) Market Share"

▲ Zcash (ZEC)/AI Generated Image

According to an analysis by a Wall Street virtual asset management company, Zcash (ZEC) is expected to show the steepest growth by absorbing Bitcoin (BTC)'s market share, leveraging the surging demand for privacy protection.

BeInCrypto reported on September 30 (local time), citing a research report by global virtual asset management company Grayscale, that Zcash's market cap surged from 0.1% of Bitcoin's market cap to 1.5% over the past year. Zach Pandl, Head of Research at Grayscale, identified Zcash as having the highest growth potential within the digital currency sector, which includes Bitcoin, Litecoin (LTC), XRP, and Zcash. He explained that as blockchain transparency increases and on-chain monitoring tools proliferate, the demand for private financial transactions grows, which could allow Zcash to gradually take away Bitcoin's market share.

Indeed, Zcash's network value has experienced explosive growth over the past year. Zcash's market cap surged from approximately $4 billion in March to a recent $24.27 billion. The coin's price also soared from around $60 to approximately $1,431, showing an increase of about 19 times in just one year. Zcash is characterized by its total supply being limited to 21 million, identical to Bitcoin, and its provision of optional security features based on zero-knowledge proofs to encrypt the sender, recipient, and transaction amount.

The conversion to institutional financial products also served as a strong catalyst for institutional capital inflow. On August 25, Grayscale officially listed a Zcash ETF on NYSE Arca under the ticker ZCSH. By converting the trust product, which had been managed since 2017, into a spot ETF, the past issues of discount/premium relative to net asset value (NAV) were resolved, leading to rapid absorption of large-scale funds.

However, Grayscale also warned of the inherent risks specific to privacy coins. It pointed out that Zcash has much higher price volatility compared to Bitcoin, and there is persistent regulatory uncertainty due to its history of delisting from several exchanges under pressure from financial regulators concerned about money laundering. The market has also presented a hypothetical scenario where Zcash's theoretical price could reach $1,622 if it were to account for 2% of Bitcoin's market cap.

In the digital currency realm dominated by Bitcoin, Zcash, backed by privacy demand, has surged 19-fold, creating a crack in market share. With the successful establishment of the spot ETF and continued capital inflows, market attention is focused on whether Zcash can overcome regulatory barriers and emerge as an independent monetary asset.

[Article Key Summary]

-Grayscale analyzed that Zcash (ZEC) market cap surged from 0.1% to 1.5% of Bitcoin (BTC)'s market cap in one year.

-With its market cap exceeding $24.27 billion and a 19-fold surge, the listing of an ETF on the New York Stock Exchange accelerated capital inflows.

-While Zcash is expected to erode Bitcoin's market share due to demand for private transactions, high price volatility and regulatory risks were cited as variables.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*