Zcash (ZEC) briefly topped $1,200, its highest level in almost a decade, after a 370% run from its early-June low. A short squeeze tied to a Grayscale spot ETF launch has driven much of the recent leg higher.
Zcash just broke above $1,200 for the first time in almost ten years, extending a rebound that has taken the privacy coin up 370% since its early-June low. The move follows a rough stretch for ZEC, which traded at $650 before a vulnerability disclosure sent it tumbling.
From $260 low to fresh highs
A flaw in Zcash's Orchard shielded pool, first disclosed by founder Zooko Wilcox and members of Shielded Labs, could have let a hacker mint fake ZEC undetected. The token tumbled 60% within a day or so to $260 as the news spread, and prominent investor Arthur Hayes dumped his entire ZEC position. The coin then stabilized near $500 for months before an August 19 market-wide breakout drove it to $900, setting up the latest push past $1,200.
A short squeeze accelerates the climb
ZEC surged roughly 20% on September 4 to an intraday high near $1,023 to $1,051, triggering a wave of forced closures that helped push total crypto liquidations to about $212 million. Short liquidations on ZEC futures alone totaled between $34.5 million and $44 million, a disproportionate share given the token's size. Open interest in ZEC futures had climbed above $2 billion, with much of that bearish positioning tracing back to the May 2026 vulnerability disclosure — exactly the kind of lopsided leverage a short squeeze feeds on.
Grayscale's ETF fuels the rally
Grayscale's ZCSH spot ETF, which launched on August 25, 2026, accumulated over $400 million in assets within two weeks of listing, and the timing lines up with ZEC's acceleration. As a result, ZEC's market cap climbed above $20 billion, surpassing HYPE and DOGE. Data from CoinGlass shows the surge also produced $46 million in short liquidations over 24 hours, the highest of any cryptocurrency.
What traders are watching
Traders are watching two variables now: the pace of ZCSH inflows, since a slowdown in the ETF's asset growth could remove the bid supporting ZEC's rally, and whether shorts rebuild at these elevated levels. With $2 billion in open interest still on the table, a sharp reversal could trigger liquidation cascades in the other direction just as easily.
Sources: CryptoPotato, Crypto Briefing
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