Grayscale's Zcash ETF (ZCSH) crossed $500 million in assets two weeks after its NYSE Arca debut, but a regulatory filing shows $100 million of that came from a company affiliated with the fund's own sponsor. Genuine outside inflows ran just over $70 million in the same period, while Zcash itself traded above $1,200 for the first time since 2016.
An affiliate provided a fifth of the milestone
Grayscale said on Sept. 8 that ZCSH had surpassed $500 million in assets under management, holding more than 550,000 ZEC after listing on Aug. 25. A Form 8-K filed the same day tells a more specific story. It shows DCG International Investments Ltd. acquired roughly $100 million of ZCSH shares by exchanging ZEC through an authorized participant.
The filing describes DCG International as an indirect subsidiary of Digital Currency Group, which is itself the indirect parent of Grayscale Investments Sponsors, the fund's sponsor. That makes the investor an affiliate of both the sponsor and the fund. A fifth of the headline milestone, in other words, moved within the same corporate family rather than arriving from the open market.
Outside demand was a fraction of the affiliate's stake
Grayscale did not obscure the split. Steve Vanourny, the firm's head of index, said the offering saw cumulative inflows of more than $70 million from outside investors in the two weeks since launch, in addition to the affiliate's $100 million investment. That outside figure is smaller than the affiliate's contribution alone.
The fund's net assets had already reached about $463 million, up from $414.7 million a week earlier, before the affiliate purchase pushed the total past half a billion. According to Grayscale: "Private money is attracting real capital." The $500 million total describes the fund's scale, then, rather than a clean readout of investor appetite for the privacy coin.
Zcash keeps climbing while bitcoin stalls
Zcash breached $1,200 on Sunday, touching an intraday peak near $1,249, its highest level since late 2016, with a 12-month gain above 2,200% and a market capitalization around $20 billion. One short seller, Garrett Jin sat roughly $25.7 million underwater on the move.
That run is unfolding while bitcoin's price stays stuck near $79,000, repeatedly rejected below $80,000 as traders wait on August inflation data and the Sept. 15-16 Federal Open Market Committee meeting.
Capital that would normally chase bitcoin has had little momentum to follow, and privacy assets have absorbed some of it.
Source: Bitcoin News
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