Zcash dropped after a Grayscale spot ETF began trading, ending a rally that had taken the token to an eight-year high. Traders now watch whether leveraged positions built during the run-up get unwound as the broader crypto market cools.
Zcash fell 7.6% to $787 on Wednesday. The drop follows a 56% weekly run that took it to an eight-year high near $880, and the pullback tracks the event that fueled that climb.
Grayscale's Zcash Trust converted to a spot ETF and began trading on NYSE Arca on Tuesday under the ticker ZCSH, holding up to 393,000 ZEC worth more than $260 million. The listing had been anticipated, and the token ran hard into it.
ZEC ripped from below $600 to above $880 in the days ahead of the listing, its highest level since 2018, as traders piled in on ETF anticipation and chatter around the token's 21-million supply cap and proof-of-work design.
That build-up shows up in the derivatives market, too. ZEC perpetual futures open interest nearly doubled to $1.8 billion during the run, so the same borrowed money that accelerated the rally can now force selling on the way down.
Bitcoin is off 2% to $78,900, with most major tokens trading lower as a week-long crypto rally takes a breather. As a result, Zcash's pullback is unfolding without any broader tailwind to cushion it.
Source: CoinDesk
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