Zcash's recent upward momentum continues to expand, with ZEC reaching as high as $1,023 on Friday, a 20% increase over 24 hours. According to CoinMarketCap data, Zcash's market capitalization has approached $17 billion, placing it among the top ten crypto assets by market cap.
Over the past month, ZEC has risen approximately 94%; over the past year, its increase has exceeded 2,300%. This has brought this long-standing privacy coin back into the mainstream market spotlight.
Futures open interest rises to approximately $2.3 billion.
Beyond the spot price increase, the expansion of the derivatives market is also significant. Current open interest in ZEC futures is approximately 2.3 million ZEC, equivalent to about $2.3 billion at current prices.
This scale represents approximately 14% of Zcash’s total market capitalization, indicating a significant increase in market leverage. Over the past 24 hours, approximately $36.6 million in ZEC leveraged positions were liquidated, with short positions accounting for about $34.5 million, or roughly 94% of the disclosed total liquidations.
A short squeeze typically further drives prices higher, as forced closing of short positions requires buying spot or futures contracts to cover the positions, amplifying the existing upward momentum.
Grayscale product adjustments bring a new entry point
Another factor driving this rally is a change in compliant investment channels for Zcash in the U.S. market. Grayscale has converted its long-standing Zcash Trust into a Zcash ETF. U.S. SEC filing documents confirmed the product’s new name and structure in late August.
The product's ticker symbol is ZCSH, allowing investors to gain exposure to ZEC through regulated broker-dealer markets. Previously, Grayscale's updated ETF filing disclosed plans to list on NYSE Arca and listed a 2.5% management fee. These developments have been viewed by the market as one of the key catalysts for this rally.
Rapid price recovery after a security incident
This rally has also drawn particular attention because Zcash recently experienced a significant pullback several months ago. Following the disclosure of a vulnerability in the Orchard shielded pool, ZEC dropped by more than 30%. Subsequently, the development team completed the fix and rolled out the Ironwood security upgrade.
While prices are rising rapidly, the market is also paying attention to the volatility risks posed by high leverage. Currently, approximately $2.3 billion in futures positions are concentrated on a single asset with a market cap of around $17 billion, meaning that if the market moves in the opposite direction, liquidation pressure could quickly intensify.
Additional information: The article mentions that Grayscale also provided a long-term scenario analysis: if Zcash’s market capitalization were to reach 10% of Bitcoin’s in the future, ZEC’s theoretical price could approach $8,100. This statement is a hypothetical scenario and not a price prediction.