Author: Vivian Nguyen
Compiled by Deep潮 TechFlow
DeepChain Overview: Grayscale’s ZCSH, the first Zcash spot ETF in the U.S., recorded a net outflow of $93.56 million in a single week, with its assets under management declining from its peak to approximately $751 million; for ZEC, this fund—which once held nearly 3.5% of the total supply—is transitioning from a buyer to a potential source of selling pressure.
The first U.S. ZEC spot fund is giving back part of its monthly gains as redemptions continue to pile up.
The first U.S. Zcash spot ETF just endured its most challenging week to date, with $93.56 million flowing out over the week.
From listing week favorite to redemption queue
This fund is Grayscale’s ZCSH, listed on NYSE Arca on August 25, 2026. It was converted from the existing Grayscale Zcash Trust and is the first listed spot ETF in the U.S. to provide direct exposure to ZEC tokens.
Spot ETFs hold the actual asset, not futures contracts tied to it. Buying one share means owning a small portion of real ZEC, held in custody by the fund.
Strong start. By mid-September, cumulative net inflows reached $271 million. The busiest week was the one ending September 18, 2026, with $98.2 million in new funds entering.
Trading during the honeymoon period was also robust. In its strongest week, ZCSH accounted for up to 32.5% of all spot crypto ETF trading volume. At its peak, the fund held approximately 3.5% of ZEC’s total supply.
The numbers behind the drawdown
The decline is clear in the daily data. On September 30, the fund recorded single-day redemptions of $30.25 million. On October 2, another $26.93 million flowed out.
These are not isolated spikes. Between late September and early October, redemptions on multiple trading days fell within the $26 million to $30 million range.
Damage is accumulating. Net inflows over the same period decreased from approximately $268 million to $212.56 million. While the fund has still seen net inflows since its launch, the buffer has clearly narrowed.
Assets under management peaked at approximately $915 million to $979 million in September and had declined to about $751 million by early October.
After the ETF listing, ZEC experienced significant price volatility. It initially surged above $1,500 before pulling back to lower levels.
A stock split with a relatively high fee
Grayscale took at least one action to ensure smooth trading. On September 18, 2026, it announced a 1-for-3 forward split of ZCSH. The record date was September 28, and shares began trading on the adjusted basis on September 30.
The timing is slightly awkward. Shares began trading on a post-split basis on September 30, the same day the fund experienced $30.25 million in outflows.
The ZCSH fee rate of 2.5% means that holders pay an annual fee equivalent to 2.5% of their investment to hold this fund.
What does this mean for ZEC and the fund?
A fund that once held approximately 3.5% of ZEC’s supply has now become a significant source of supply and demand pressure for the token. When ZCSH experiences inflows, the fund must hold more ZEC; during redemptions, the relationship reverses.
For Grayscale, the situation is mixed rather than entirely bleak. The fund still holds approximately $751 million in assets, with cumulative net inflows remaining positive at $212.56 million.
For the broader crypto ETF market, ZCSH demonstrates that spot products built around smaller tokens can capture remarkable trading volumes—peaking at 32.5% of total spot crypto ETF trading volume.
The next key points to watch are straightforward. First, will daily redemptions continue to remain in the $26 million to $30 million range, or will they begin to narrow? Second, can the ZEC price hold steady, as this directly supports AUM? Third, has the stock split delivered the liquidity boost Grayscale anticipated?