Zcash has struggled to recover over the past several days, with broader market uncertainty limiting its upward momentum. Despite this stagnant price action, the privacy-focused altcoin may soon see renewed interest thanks to a major development from Grayscale.
The asset manager’s latest regulatory filing has positioned Zcash as a potential candidate for one of the next spot crypto ETFs in the US, sparking optimism for a rebound.
Zcash Traders Should Watch Out
Market indicators show that Zcash has been facing persistent outflows. The Chaikin Money Flow (CMF) on the daily chart has been trending downward, reflecting weak demand from investors. As ZEC’s price failed to make meaningful gains, many holders began exiting positions to avoid deeper losses.
This sustained selling pressure has constrained attempts at recovery.
However, sentiment could shift significantly following Grayscale’s submission of the ZCSH Form S-3. This filing is a key regulatory step toward launching the first Zcash exchange-traded products (ETP), Grayscale stated.
If approved, a spot ZEC ETF would provide institutional-grade access and likely boost demand. Historically, ETF narratives have generated strong inflows, and Zcash could benefit similarly as investors anticipate greater market exposure.
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ZEC CMF. Source: TradingView
On-chain and derivatives data also signal potential upside. Zcash’s liquidation map shows that short traders may be in a vulnerable position. A modest price move toward the next resistance at $600 would trigger an estimated $19.43 million in short liquidations.
Such conditions create a delicate setup in which even small demand shocks — such as ETF-driven speculation — could generate outsized market reactions. If inflows return and shorts unwind, Zcash may experience a rapid upward surge.
Zcash Liquidation Map. Source: Coinglass
ZEC Price Needs Support
ZEC is currently trading at $543, holding above the $520 support level while struggling to break above $600. This range has constrained the altcoin’s movement as investors wait for clearer signals from both market sentiment and regulatory developments.
If Grayscale’s filing revives investor confidence, ZEC may push toward $600. A successful breakout above that level could liquidate a significant number of short positions and also bring the altcoin closer to the $700 mark.
ZEC Price Analysis. Source: TradingView
However, if demand fails to return, Zcash may continue consolidating between $520 and $600. A breakdown below support could send the price toward $442, invalidating the bullish thesis and delaying recovery efforts.
