Grayscale Files to Convert Zcash Trust to Exchange-Traded Product

Delphi Digital's Simon Shockey highlights a significant development in the Zcash (ZEC) market, emphasizing the emergence of a GBTC-style discount dislocation in its trust setup, similar to past occurrences with Grayscale’s Bitcoin product.

The Zcash trust is drawing parallels to Grayscale's Bitcoin Trust (GBTC), which previously experienced a 30-40% premium and later flipped to a discount, impacting major players like BlockFi and Genesis.
A potential structural shift is underway as Grayscale filed to convert their Zcash trust into an exchange-traded product (ETP), enabling one-to-one redemptions of the actual ZEC held.
This conversion could tighten the current 20% discount on ZCSH shares, aligning them closer to NAV, much like GBTC did with ETF approval prospects.
Shockey suggests that buying ZCSH at a discount and selling after convergence offers a straightforward investment opportunity, with additional upside if ZEC's value increases during the approval process.
An ETP could attract new demand from funds unable to hold ZEC directly, thus potentially reducing discounts.
Market narratives around Bitcoin's privacy issues and quantum risks are gaining traction, positioning ZEC as a possible alternative hedge.

At the time of reporting, Zcash was trading at $509.84.

ZCash price