Grayscale filed a fifth amendment to convert its Zcash Trust into a spot ETF, setting a 2.5% sponsor fee and a listing on NYSE Arca under ticker ZCH. The filing would make it the first U.S. fund to directly track a privacy-focused digital asset, and a Digital Currency Group subsidiary is discussing contributing about 200,000 ZEC to the fund.
Grayscale filed a fifth amendment with the U.S. Securities and Exchange Commission on Friday, pushing its Zcash Trust closer to becoming a spot ETF. The proposed fund would be the first in the U.S. to directly track a privacy-related asset.
Filing sets ticker, fee, and custodian
The latest amendment renames the trust The Zcash ETF and sets its sponsor fee at an annual rate of 2.5%. The fund would list on NYSE Arca under the ticker ZCH, with the Bank of New York Mellon as transfer agent and Coinbase Custody Trust Company as custodian. According to Bloomberg Intelligence ETF Analyst James Seyffart: "Looks like they're getting closer and closer to converting this thing into an ETF".
DCG in talks to contribute ZEC
In its fourth amended filing earlier this week, Grayscale said a Digital Currency Group subsidiary was in discussions to potentially contribute about 200,000 ZEC to the fund. Crypto Briefing reported the proposed contribution would be valued at around $110 million, citing a non-binding proposal tied to the trust. The filings also name Jane Street Capital and Virtu Americas as authorized participants, with Coinbase handling custody.
A test case for privacy assets
Zcash uses zero-knowledge proofs to shield sender addresses, recipient addresses, and transaction amounts from public view, and the SEC has not previously approved a spot ETF for a privacy-focused digital asset. Grayscale's Zcash Trust has run since 2017 and held over $260 million in assets under management as of Friday.
The trust has swung between a premium of up to 240% above net asset value and a discount as steep as 55% below it. Zcash is the 12th-largest crypto by market capitalization, created in 2016 and designed around privacy. If the SEC greenlights the filing, Grayscale's fund would be the first of its kind in the U.S., the first spot ETF tracking a privacy coin.
Sources: The Block, Crypto Briefing
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