Grayscale’s Zcash fund began trading on NYSE Arca on August 25 under the ticker ZCSH, marking its move from an existing trust structure into an exchange-traded fund. Grayscale describes it as the first exchange-traded product globally to provide spot exposure to Zcash, the privacy-focused cryptocurrency known by the ticker ZEC.

The fund’s registration statement became effective on August 24, and NYSE Arca certified the listing the same day. As part of the conversion, the product dropped the Grayscale Zcash Trust name. The final prospectus also confirmed a 2.5% annual sponsor fee.

From private placement to exchange listing

The product that is now trading as the Zcash ETF has been in the market for years in earlier forms. Its predecessor was launched as a private placement in October 2017, and its shares have been quoted on OTCQX since October 2021.

The NYSE Arca debut formalizes the next stage of that structure. The listing arrived one day after the registration statement was declared effective, completing the transition from the prior trust format into an exchange-traded vehicle.

Discount to net asset value narrowed sharply

Recent trading in the fund’s shares showed the gap to net asset value shrinking before the listing. Shares traded at a 17% discount to NAV on June 30, narrowed to a 7% discount by August 12, and reached a 1% discount by August 20.

On that August 20 close, the shares were priced at $45.34 on OTCQX. At the end of June, the trust reported net asset value of $155.2 million, with holdings equal to about 2.3% of the ZEC then in circulation.

Custody and ownership discussions remain in focus

The prospectus identifies Coinbase Custody Trust Company as the custodian holding the fund’s ZEC, while Foreside Fund Services acts as the marketing agent.

It also repeats a risk disclosure tied to Digital Currency Group, Grayscale’s parent company. According to the filing, DCG International Investments is still in discussions to acquire shares through an authorized participant in exchange for roughly 200,000 ZEC, a position expected to represent a substantial portion of the fund’s ownership.

The document says those talks are not binding and that the subsidiary could ultimately buy more shares, fewer shares, or none at all. It also warns that DCG may come to own a majority of the shares.

Zcash backdrop as the ETF launches

Zcash, launched in 2016, combines a Bitcoin-like 21 million coin supply cap and proof-of-work consensus with optional privacy features that can shield sender, recipient, and amount information. In promoting the ETF, Grayscale pointed to the network’s upgrade history, including Sapling in 2018, Orchard in 2022, and Ironwood, which went live in July and included a turnstile mechanism intended to guard against counterfeit coins.

In a post on X, Grayscale said shielded supply stood at 4.4 million ZEC, or about 26% of circulating supply. According to CoinGecko data cited in the source article, ZEC traded at $785 on August 26, giving it a market capitalization of $13.2 billion and making it the 12th-largest digital asset by that measure.

The same report said the token had reached roughly $880 two days before the listing, its highest level since January 2018. The next confirmed development is the fund’s first period of trading on NYSE Arca under the new ZCSH ticker, with the market set to absorb both the new ETF structure and any future update on the DCG share-purchase discussions.

Source: cryptopotato.com