As a vital bridge connecting traditional finance with the crypto world, Grayscale’s every move serves as a market bellwether. At the Consensus conference, which concluded in Hong Kong on February 14, Grayscale’s Chief Legal Officer Craig Salm delivered a major statement on privacy coin Zcash. He described its technical features as "extremely interesting" and confirmed that Grayscale is actively working to convert its Zcash Trust (Grayscale Zcash Trust) into an exchange-traded fund (ETF).
This announcement has injected new energy into the long-quiet privacy sector and put ZEC back in the spotlight. As of February 14, according to data from the Gate trading platform, the ZEC price remained volatile at elevated levels following the news, with the latest quote at $283 and intraday gains exceeding 25% at one point.
Selective Disclosure: Addressing Business Needs and Regulatory Challenges
Transparency in traditional blockchain is a double-edged sword. At the conference, Craig Salm pointed out that when businesses need to make large payments to suppliers, Bitcoin’s full transparency can expose core commercial information. "We’ve all seen accounts on Platform X that specialize in tracking on-chain transactions. So you can imagine the scenarios where this kind of need arises," Salm explained.
Zcash stands out with its selective disclosure mechanism. Salm emphasized that this is Zcash’s most compelling feature: users can choose to disclose transaction information to specific parties. For example, during a tax audit, users can provide keys to the IRS to prove compliance; for routine business or personal transactions, zero-knowledge proofs ensure complete privacy.
This perspective cleverly repositions privacy coins—not as tools for evading regulation, but as essential infrastructure for legitimate enterprise operations. Grayscale believes that Zcash’s blend of privacy and compliance gives it the potential to become a "very interesting currency," fully qualified for mainstream financial markets.
Trust-to-ETF Conversion: A Key Step Toward Regulatory Integration
Grayscale isn’t just offering verbal praise; it’s taking concrete regulatory steps. Craig Salm confirmed at the conference, "We already have a sizable Zcash Trust, and we’re working to convert it into an ETF, just as we’ve done with several other products."
This refers to Grayscale’s previous S-3 registration statement filed with the U.S. Securities and Exchange Commission (SEC), aiming to convert the Grayscale Zcash Trust (ZCSH) into a spot ETF listed on the NYSE Arca. Public records show the trust is substantial, holding about 5% of Zcash’s circulating supply with a management fee of 2.50%.
If this ETF launches successfully, it would be the first ETF product in the U.S. stock market backed by a privacy coin. This would simplify the process for traditional institutions to gain exposure to ZEC—no need to manage private keys or navigate complex on-chain operations. More importantly, it would bring Zcash under the U.S. mainstream regulatory framework. As Craig Salm argued, Zcash is not a tool for money laundering; its built-in "view key" feature can fully meet anti-money laundering and tax audit requirements.
Market Response: ZEC Price and On-Chain Metrics Surge
The market has responded enthusiastically to Grayscale’s announcement. On the Gate trading platform, the ZEC/USDT pair saw active trading over the past 24 hours. Not only did the price climb near $290, but open interest in the derivatives market also reached approximately $230,000,000.
On-chain data shows a quiet rise in the adoption of Zcash’s privacy features. As of now, ZEC’s circulating supply stands at around 16,490,000 coins, with its overall market capitalization firmly among the top crypto assets. More notably, the amount of ZEC locked in the Shielded Pool continues to grow, now accounting for a significant share of total circulation—evidence that more holders are leveraging its privacy capabilities.
On Gate and other major trading platforms, ZEC maintains deep liquidity in its spot order books, while its futures market exhibits a neutral-to-bullish funding rate. From a technical analysis perspective, if ZEC can hold above the $300–$305 resistance zone, the next targets may be $340 or even $380.
Divergence in the Privacy Sector: Zcash’s Compliance Advantage
It’s worth noting that Grayscale’s strong endorsement of Zcash has sparked a major debate within the privacy coin sector about technical direction. With the advancement of the U.S. Digital Asset Market Clarity Act (CLARITY Act), regulators’ attitudes toward privacy coins are becoming increasingly distinct.
The Act requires exchanges to conduct comprehensive transaction monitoring, posing significant challenges for tokens with default full privacy (like Monero). Zcash’s "optional privacy" design fits these regulatory requirements: it supports transparent transactions for audits and fully shielded transactions for privacy. This flexibility allows exchanges and custodians to support privacy features while maintaining compliance.
Recently, ZEC’s market capitalization has surpassed Monero (XMR), reclaiming the top spot in the privacy coin sector—a clear sign that the market recognizes the narrative of "compliant privacy."
Conclusion
Grayscale’s statements at the Consensus Hong Kong conference are far more than mere project promotion—they represent a thoughtful regulatory strategy. By positioning Zcash as a "regulation-compliant privacy solution," Grayscale is paving the way for its trust product’s ETF conversion.
For investors tracking ZEC’s real-time price and on-chain activity on platforms like Gate, it’s important to recognize that Zcash’s narrative has fundamentally shifted. It’s no longer just a rumored payment tool for the dark web; it’s evolving into a financial instrument for institutions to combat corporate espionage and protect intellectual property.
As Grayscale advances its ETF conversion and U.S. regulatory frameworks become clearer, whether Zcash can truly enter mainstream finance will be one of the most closely watched developments in the crypto market in 2026. Currently, ZEC is quoted at $281.61 on Gate, and the market is eagerly awaiting the next breakthrough.
