Zama Protocol Climbs 27% as Whales and Institutional Buyers Accumulate Amid Daily Token Unlocks
Key Takeaways
- •ZAMA rallied more than 27% over 24 hours, reaching a new all-time high of $0.05171 as trading volume surged 185% to $100 million.
- •A single whale wallet has accumulated 98.18 million ZAMA tokens valued at $3.93 million over 125 days, including over 28 million tokens purchased in just the past two days.
- •Only 19.66% of ZAMA's total 11.19 billion supply is currently circulating, with approximately $200K worth of tokens entering the market daily and large annual unlocks scheduled through 2030.
- •Multicoin Capital has publicly disclosed a long position in ZAMA, with co-founder Tushar Jain citing institutional demand for on-chain privacy as the rationale.
- •ZAMA's holder base stands at just 7,640 addresses, and low liquidity relative to its $564 million fully diluted valuation raises concerns about the sustainability of the current rally.
Zama Protocol [ZAMA] has surged more than 27% over the past 24 hours, outpacing all other tokens in the privacy sector for daily gains. Trading volume skyrocketed by over 185% to reach $100 million — nearly matching the project's market capitalization of $110.38 million.
The token's market cap remains roughly five times lower than its fully diluted valuation (FDV) of $564 million. Liquidity sits at a moderate level, with a liquidity-to-market-cap ratio of 2.51%, making the token accessible for average retail investors while presenting execution challenges for larger institutional traders.
Tokenomics and Supply Dynamics
According to tokenomics data, 2.2 billion ZAMA tokens are currently in circulation out of a total supply of 11.19 billion, meaning only 19.66% of the supply is circulating while the remaining approximately 80% is being released on a daily schedule. CoinMarketCap data indicates that 4.06 million ZAMA, valued at approximately $200K, enters the market each day. Additional large token unlocks of 1.98 billion ZAMA are scheduled annually through 2030.
Sustained daily emissions of this magnitude typically exert downward pressure on token prices, as recipients sell into the market. The fact that ZAMA has rallied sharply despite this ongoing supply overhang points to demand-side strength absorbing the newly released tokens.
Whale Accumulation and Institutional Backing
Despite the token generation event (TGE) only taking place in early February 2026, the privacy protocol has attracted significant interest from whales and institutional players.
Zama Protocol is built on fully homomorphic encryption (FHE), a cryptographic technique that enables computation on encrypted data without decrypting it. This technology underpins the project's pitch of bringing privacy-preserving smart contracts and private DeFi to blockchain networks, positioning it alongside established privacy projects like Zcash (ZEC) in a sector that has attracted renewed institutional attention as financial firms explore on-chain confidentiality.
One whale has been consistently accumulating ZAMA through the Kraken exchange. Over the past two days alone, this wallet purchased more than 28 million ZAMA, including a recent transaction of 14.26 million tokens worth $571K. Over the past 125 days, the same wallet has acquired a total of 98.18 million ZAMA tokens, valued at $3.93 million. This aggressive absorption of newly released supply helps explain the altcoin's rally despite ongoing daily token unlocks.
Multicoin Capital has also been buying the altcoin. Tushar Jain, Co-Founder and Managing Partner at Multicoin Capital, expressed support for the protocol's privacy focus in a post on X:
Institutions need privacy to operate. This is why we're long $ZAMA and $ZEC. Zama unlocks private defi…
Social Momentum
Social sentiment has further amplified the rally. ZAMA was trending at the number one position on CoinGecko and second on CoinMarketCap. The token has gained over 41% over the past week, reinforcing positive market attention.
Price Action and Technical Outlook
On the daily chart, ZAMA broke out of an ascending trend channel that had been respected since its February TGE. The token printed a new all-time high of $0.05171, with MACD bars indicating building bullish momentum. The Cumulative Volume Delta (CVD) was also predominantly bullish, showing more than 40 million ZAMA purchased on Binance's spot market.
The four consecutive days of gains began at trendline support around $0.0300 and culminated in a breach of the upper trendline resistance. However, the total number of ZAMA holders stands at just 7,640, a relatively small community that may limit the sustainability of such rallies. Additionally, the token faces the possibility of a post-breakout retracement, with prices potentially pulling back to $0.045 or lower. The combination of a thin holder base, low liquidity relative to FDV, and large annual unlocks through 2030 means the token's trajectory will likely depend on whether institutional and whale demand continues to outpace the expanding circulating supply.