Grayscale Investments is moving closer to launching a spot Zcash ETF, with shares of its Grayscale Zcash Trust expected to begin trading on NYSE Arca as soon as August 25 under the ticker ZCSH.

The development has coincided with a sharp rally in ZEC, the privacy-focused cryptocurrency, which reached its highest level since 2018, moving above $850.

Why Grayscale Is Launching the Zcash ETF

In a filing submitted to the U.S. Securities and Exchange Commission on August 21, Grayscale said it plans to convert its existing Zcash Trust into The Zcash ETF and transfer the shares from the OTCQX marketplace.

The August 24 Form 8-A registered the ETF shares for listing on NYSE Arca, while a post-effective amendment to Form S-3 identified the registrant as The Zcash ETF.

Grayscale said trading is expected around August 25, but it did not guarantee that the listing would take place on that date.

The fund will use Coinbase Custody Trust Company as custodian, while The Bank of New York Mellon will serve as transfer agent and administrator.

The proposed sponsor fee is 2.5% annually, significantly higher than the fees charged by many major spot crypto ETFs. The fee accrues daily and is payable in ZEC.

What Role Could DCG Play in the Zcash ETF?

Grayscale also said it is in talks with DCG International Investments, a subsidiary of parent company Digital Currency Group, about a potential contribution of about 200,000 ZEC in exchange for ETF shares.

Based on the trust’s June 30 share ratio, that amount would represent roughly 34% of the expanded fund.

The arrangement is nonbinding, and Grayscale said DCG could ultimately acquire more, fewer, or no shares.

ZEC Reaches an Eight-Year High

ZEC extended its rally following the ETF news. The token briefly traded near $853 on August 23, marking its highest level since 2018. Derivatives activity also increased, with $9.54 billion in 24-hour futures volume and $1.76 billion in open interest at the time.

As of August 25, ZEC was trading around $851, with a market capitalization of roughly $14.37 billion, according to CoinGecko.

Why This Matters

ZCSH would become the first U.S. exchange-traded product tracking Zcash, a privacy coin that regulators have historically scrutinized closely. That makes the listing notable not just for Grayscale’s product lineup, but also because it gives U.S. investors a new exchange-listed way to gain exposure to an asset class that has often sat at the center of compliance debate.

The prospect of a nonbinding stake of about 34% from Grayscale’s parent company also raises questions about supply concentration and potential price influence once the fund begins trading. At the same time, the filing details — including the higher sponsor fee, the use of ZEC to pay that fee, and the planned custodial setup — show how the ETF structure is being put in place before trading begins.

On the Flipside

A DCG stake near 34% could create concentration risk. A large redemption could pressure ZEC’s price and reduce the fund’s free float, while DCG’s role as both parent of the sponsor and a major holder raises a related-party conflict of interest.

Because the contribution talks are nonbinding, DCG could contribute less than 200,000 ZEC or withdraw entirely.