The Zcash ETF Nobody Asked For: Why Critics Fear a Wall Street Takeover
Grayscale’s resolution to transform its Zcash Trust into an ETF has ignited one of the polarizing debates within the privacy-coin ecosystem.
For Zcash advocates and decentralization purists, the transfer represents one thing much more consequential than a new funding product. To them, it alerts a potential takeover of a privacy-focused cryptocurrency by the very establishments it was designed to keep away from.
A Privacy Coin in an ETF? Critics Say It Breaks the Mission
The submitting, submitted on November 26, 2025, seeks to rework a belief holding over 394,000 ZEC, valued at roughly $197 million, into a absolutely regulated exchange-traded fund (ETF).
Eric Van Tassel, a consumer on X (Twitter), argues that a ZEC ETF is basically incompatible with Zcash’s function.
“I hope ZEC by no means will get one, as as soon as that occurs, an asset is now not decentralized,”
Eric said, calling ETFs “a Trojan horse.”
Eric’s critique is just not about ETFs as monetary devices; it’s concerning the control structures they create. Unlike spot buying and selling on crypto exchanges, ETFs focus affect amongst Wall Street corporations that make buying and selling, market-making, and custodial selections.
For a privateness coin, that focus is existential.
“An ETF successfully signifies that an asset worth can be extremely influenced and managed by Wall Street,” Eric warned.
SEC filings show the Grayscale Zcash Trust controls about 2.4% of ZEC’s circulating provide, already giving the asset one of many highest institutional concentrations amongst privateness cash. Converting the belief to an ETF would additional broaden its affect.
The crypto trade has already seen the draw back. When the Grayscale Bitcoin Trust (GBTC) transformed to an ETF in January 2024, redemptions created intense sell-side stress. The basic sentiment is that a related redemption wave might hit Zcash.
Data reinforces this concern, displaying markets nonetheless bear in mind the times when GBTC outflows repeatedly pushed Bitcoin decrease. Eric argues these dynamics are not any accident.
“The current dump was influenced by these big establishments that now management many of those property… Their final aim is to both destroy crypto or utterly management it as a a part of their CBDC agenda,” he added.
Meanwhile, the Grayscale Zcash Trust is already flashing warning indicators.
- NAV/Share: $42.59
- Market Price: $35.05
- Discount: roughly 18%
Such a steep low cost reveals shareholders could also be anticipating additional worth stress, or no less than are unwilling to pay full worth for property that will quickly face ETF-linked promoting stress.
The belief presently manages $205.7 million, fees a 2.5% expense ratio, and has 4.83 million shares excellent. High charges and regulatory ambiguity could clarify why buyers count on turbulence forward.
Why Zcash Has Outperformed, And Why That Might End
Despite regulatory headwinds, ZEC has considerably outperformed a number of main altcoins in current months. Critics argue that is exactly as a result of it’s not but below ETF management, leaving its worth motion extra natural and fewer prone to institutional flows.
“The proven fact that Zcash doesn’t presently have an ETF is perhaps a good cause why Zcash has been shifting so nicely,” Erin noted.
He even speculates that Bitcoin’s ETF-driven structure has capped its upside:
“I see $140,000 to $150,000 max out of Bitcoin this cycle… Money will roll into the property that these ETFs don’t management,” he indicated.
The SEC, not the Electric Coin Company (which develops Zcash), will decide the destiny of the Zcash ETF. If authorized, it will mark the first-ever ETF tied to a main privateness coin, probably rewriting the regulatory path for related property.
But the implications transcend coverage. Zcash was constructed for monetary privateness amid a surveillance period.
The query now’s whether or not that mission can face up to the gravitational pull of Wall Street, or whether or not, as critics warn, an ETF would remodel ZEC from a decentralized, privacy-focused software into a tightly managed institutional asset.
Perhaps, these fears clarify why Zcash’s ZEC token is barely up by a modest 0.7% within the final 24 hours regardless of Grayscale’s expressed curiosity.
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