Grayscale Zcash ETF Sees $93.6M in Outflows as ZEC Slides

Grayscale's U.S.-listed spot Zcash fund recorded $93.56 million in net outflows for the week ended Oct. 2 as ZEC retreated toward $1,300, marking the fund's first weekly net withdrawal since late August, according to SoSoValue data reported by CryptoNews.

The weekly outflows reduced total net assets in the Grayscale Zcash ETF (ZCSH) to approximately $751 million, down from over $1 billion reached in late September. Cumulative net inflows since the trust converted to an exchange-traded product on Aug. 25 remained positive at roughly $212.56 million.

Outflows Accelerate Alongside Price Correction

Daily redemptions picked up toward the end of September, with $30.25 million leaving ZCSH on Sept. 30 and another $26.93 million withdrawn on Oct. 2. The outflows followed a period of heavy accumulation in mid-September, when the fund gathered about $271 million in cumulative net inflows, bolstered by a roughly $100 million investment by Digital Currency Group on Sept. 8.

ZEC's market price fell in tandem with the withdrawals. After closing at $1,653.12 on Sept. 26, ZEC dropped 21% to close at $1,304.32 on Oct. 3. Data showed selling pressure also broadened in derivatives markets, with ZEC perpetual open interest on OKX declining from $236.8 million on Sept. 18 to $165 million on Sept. 28.

Share Split and Approaching Network Upgrade

Grayscale executed a three-for-one forward share split for ZCSH on Sept. 30. The split increased shares outstanding from 7,989,300 to 23,967,900, adjusting the net asset value per share from $111.41 down to $37.14 without changing the total dollar value of holdings.

Meanwhile, the Zcash Foundation announced Zebra 7.0.0-rc.0 on Oct. 2, the initial release candidate for the NU7 network upgrade. The update, scheduled for testnet activation on Oct. 6 and targeted for mainnet on Nov. 5, aims to cut Zcash's target block time from 75 seconds to 25 seconds and deploy the Network Sustainability Mechanism.

Key facts

• Grayscale ZCSH posted $93.56 million in weekly net outflows for the week ended Oct. 2.
• Total assets under management dropped to roughly $751 million, down from late-September highs above $1 billion.
• ZEC declined approximately 21% from $1,653.12 on Sept. 26 to $1,304.32 on Oct. 3.
• Grayscale completed a 3-for-1 forward share split on Sept. 30, adjusting NAV per share to $37.14.
• Zcash testnet activation for the NU7 upgrade is slated for Oct. 6, targeting a Nov. 5 mainnet release.