ZCash (ZEC) spent another day surging ahead of the market, seemingly unaffected by corrections. The coin, which lagged during previous cycles, is now moving close to $400.
ZCash (ZEC) is preparing to break another milestone, moving closer to $400. Not even significant market corrections work against the ZEC rally, which is based on a unique combination of factors.
At its peak, ZEC almost flipped Litecoin (LTC), while expecting to move to even higher valuations and return to four-digit prices. ZEC traded at $382.51, adding another 10% to its price in the past 24 hours.
The expansion happened just as BTC dipped to local lows under $107,000, while ZEC only dipped to $300. Immediately after that, ZEC resumed its climb.
Open interest for ZEC also recovered fast, going back to over $434M. However, short positions now make up more than 62% of total open interest. ZEC has shown a trend for temporary dips, allowing some short traders to lock in gains.
For now, the short and long liquidations for ZEC are roughly equal, at around $3.2M in the past 24 hours. Binance is the most active market for derivative trading, with the highest level of ZEC liquidations.
ZEC has gained over 560% against BTC in the past year. The mining coin still has significant supply held by early miners and adopters. ZEC is yet to recover its reputation and position itself as a confidential alternative to BTC, without Bitcoin’s infrastructure and wider investor base.
ZEC is the top privacy coin
ZEC flipped Monero (XMR) as the top privacy coin, and other assets are yet to catch up. LTC has also been added to the list and has the highest market cap above $7B. However, ZEC is expected to challenge the current balance.
Other privacy tokens are also going through spectacular pumps, despite the weakness of the altcoin market. DASH is among the legacy coins to retain some of its gains, currently trading at $47.70 after years of sideways trading in the $20 range.
Railgun (RAIL) returned to $2.71, with other privacy coins also rising on demand for anonymous DeFi activity.
ZEC rises on DeFi use cases
The ZEC rally has shown signs of influencers and whales boosting the price. At the same time, there is also conviction buying from retail. ZEC tries to present itself as old-school crypto with a privacy narrative, leading to retail accumulation.
The data on current ZEC usage in DeFi are limited. On Near Protocol, one of ZEC’s main decentralized venues, the token is held by just 6,239 wallets. Currently, ZEC is relatively illiquid, and has seen almost no institutional interest. This allows the token to rally in its small ecosystem, but not long-term sustainability.
Despite this, ZEC is getting tested as an anonymous tool for DeFi usage. On Near Protocol, ZEC is showing signs of active trading for small amounts of tokens.
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