Grayscale, the leading crypto asset manager, on Wednesday filed a Form S-3 registration statement with the US Securities and Exchange Commission (SEC) to convert its Grayscale Zcash Trust into a spot exchange-traded fund (ETF).

As of November 25, the Grayscale Zcash Trust held around 394,400 ZEC, valued at roughly $199.2 million at current market prices.

If approved, this would be the first US-listed ETF dedicated solely to Zcash (ZEC), offering both retail and institutional investors a regulated way to gain exposure to the privacy coin.

The proposed ETF reflects Zcash’s dramatic rise in prominence, both in price and adoption.

Over the past year, ZEC has surged more than 1,050%, outperforming both Bitcoin (BTC) and Ethereum (ETH).

Its rally has been fueled by growing investor interest in privacy-preserving digital assets and the expanding use of shielded transactions, which conceal the sender, recipient, and amount while still allowing selective disclosure when needed.

Roughly 30% of Zcash transactions now involve the shielded pool, and between 20% and 25% of the total supply is held in encrypted addresses.

This increased usage has helped ZEC surpass Monero to become the largest privacy-focused cryptocurrency by market capitalisation.

Grayscale has emphasised Zcash’s zero-knowledge cryptography, or zk-SNARKs, as a central feature of the token’s long-term relevance.

The asset manager stated that as privacy becomes a foundational element in the crypto ecosystem, ZEC represents a key contributor to a well-balanced digital asset portfolio.

By offering a regulated ETF, Grayscale aims to provide investors with cost-efficient exposure to ZEC without requiring them to directly hold or manage the tokens.

According to the preliminary prospectus, the Zcash ETF would be listed on NYSE Arca under the ticker ZCSH.

Coinbase Custody will serve as the custodian, while Coinbase itself is named as the prime broker.

The Bank of New York Mellon will act as the transfer agent and administrator for the fund.

Shares are intended to be issued and redeemed in 10,000-unit baskets, which required approximately 817 ZEC at the time of filing.

The fund will initially accept only cash orders, though in-kind creations and redemptions could be added later if the SEC and NYSE Arca grant additional approvals.

Grayscale’s move mirrors its earlier conversions of other single-asset trusts, including the Bitcoin Trust and Dogecoin Trust, into ETFs, reflecting the firm’s broader strategy of bringing regulated investment vehicles to previously private crypto offerings.

Grayscale has highlighted the risks associated with investing in ZEC and the trust, noting that the asset is speculative and entails the possibility of losing principal.

Regulatory uncertainty remains a significant consideration, with privacy-focused digital assets facing evolving scrutiny in the US and abroad.

The SEC’s timeline for approving such conversions varies, with some filings taking months and others more than a year.

While past approvals, such as the Dogecoin Trust conversion, were completed in roughly three months, there is no guarantee of timing for the Zcash ETF.

But despite these uncertainties, the filing demonstrates growing institutional and mainstream interest in privacy-oriented cryptocurrencies.

The Winklevoss brothers’ recent launch of Cypherpunk, the first US public ZEC digital asset treasury, further underscores investor demand for regulated exposure to Zcash.

Grayscale’s initiative positions it at the forefront of this trend, offering a familiar, regulated vehicle for accessing one of the fastest-growing assets in the crypto market.

If approved, the ZEC ETF would provide a new entry point for those seeking to participate in Zcash’s rapid growth while benefiting from the transparency and oversight of a regulated exchange-traded fund.

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