In a landmark move for privacy-focused cryptocurrencies, Grayscale Investments has officially filed with the U.S. Securities and Exchange Commission (SEC) to convert its Grayscale Zcash Trust into a spot Exchange-Traded Fund (ETF). The filing, submitted on November 26, 2025, proposes listing the new ETF on the NYSE Arca under the ticker symbol “ZCSH”.
This initiative aims to transform the existing trust, which holds approximately 394,400 ZEC (valued at around $200 million), into a more accessible and regulated investment vehicle. If approved, it would mark the first U.S. ETF to offer investors exposure to Zcash (ZEC), a digital asset known for its pioneering use of zero-knowledge proofs to enable private transactions.
A Regulated Gateway to Privacy
Grayscale’s filing represents a significant step in bridging the world of institutional finance with privacy-enhancing digital assets. The proposed ETF is designed to provide both retail and institutional investors a mainstream, regulated pathway to gain exposure to ZEC’s price without the complexities of direct ownership, such as managing private keys or navigating crypto exchanges. The underlying ZEC assets would be held in secure, institutional-grade custody with Coinbase Custody, while BNY Mellon would serve as the transfer agent and administrator, ensuring a robust compliance and security framework.
A key aspect of this proposal is its focus on Zcash’s unique “selective privacy” model. Unlike some other privacy coins, Zcash offers both transparent and shielded (private) transactions. This optionality, powered by zk-SNARKs technology, allows users to encrypt transaction details while still providing a framework for selective disclosure, which is seen as a critical feature for aligning with institutional and regulatory requirements. This architecture is increasingly argued to be compatible with the transparency demanded by modern compliance frameworks, potentially paving the way for greater acceptance of privacy-focused technologies in regulated markets.
Market Context and Investor Implications
The filing comes at a dynamic time for Zcash. The token has witnessed a remarkable price surge of nearly 1,000% over the past year, recently trading above $500 and reclaiming its position as the largest privacy coin by market cap. This rally has been accompanied by a notable increase in the adoption of its core privacy feature, with estimates suggesting that 25-30% of all ZEC is now held in shielded addresses. The announcement also follows a pattern of growing institutional interest, with companies like Reliance Global Group publicly consolidating their digital asset treasury into Zcash, citing its unique value proposition.
For investors, the potential launch of a spot Zcash ETF would offer several advantages. It would provide easy access through standard brokerage accounts, improve liquidity, and offer tighter tracking to ZEC’s spot price compared to the existing trust structure. However, it’s crucial to recognize that this is still a proposal. The SEC’s review process is pending, and given ZEC’s status as a privacy coin, regulators are likely to apply heightened scrutiny concerning anti-money laundering (AML) and market surveillance, which could influence the final approval and timeline. Based on Grayscale’s previous conversions, a best-case scenario could see approval within several months, though a longer review into late 2026 is possible.
Grayscale’s filing to create the first U.S. spot Zcash ETF is a pivotal moment that could fundamentally reshape the accessibility and perception of privacy coins. By offering a regulated wrapper around ZEC, it tests the boundaries of the current financial landscape and signals a growing institutional willingness to engage with digital assets that prioritize user privacy. The market will now watch closely as the SEC deliberates, a decision that will determine whether this bold vision for a private, yet compliant, digital asset becomes a reality for mainstream investors.
