ZEC up 6x in a month, what's driving this rally?

Author: Akash Girimath

Translation: Chopper, Foresight News

Summary

• With the November halving approaching and renewed market interest in privacy-focused assets, Zcash (ZEC) has returned to the spotlight as traders actively position themselves around the privacy coin narrative.

• Sources told Decrypt that despite limited on-chain growth, endorsements from prominent investors and heightened discussions around privacy have driven market activity.

• Experts say the sustainability of this rally depends on post-halving market sentiment and whether user adoption can move beyond short-term speculation to achieve meaningful growth.

Fueled by speculative enthusiasm and a resurgence of interest in privacy, Zcash achieved triple-digit gains within 30 days, surpassing its 2021 highs. The privacy coin surged from a low of $54 to around $372 in just one month, ranking among the top-performing assets in the market.

Historical price chart of ZEC, source: CoinMarketCap

This price is 11.5% higher than its May 8, 2021 closing price of $319, but according to CoinGecko data, it remains 88% below its all-time high of $3,191.93 reached nearly nine years ago.

Multiplying Catalysts Create a Perfect Storm

Shivam Thakral, CEO of BuyUCoin, said Zcash’s surge stems from a perfect alignment of multiple catalysts:

1. The upcoming halving in November. On November 18, Zcash’s block reward is expected to halve from 3.125 ZEC to 1.5625 ZEC;

2. Rising privacy concerns are driving renewed attention to privacy coins;

3. Arthur Hayes’ proposal of a "$10,000 target price" has sparked widespread market discussion.

In the first week of October, Zcash saw its initial sharp upward breakout, triggered by endorsements from well-known investors such as Naval Ravikant and support from Mert Mumtaz, former Coinbase engineer and CEO of Helius.

As previously reported by Decrypt, Grayscale’s decision to allow accredited investors to invest in ZEC tokens further boosted Zcash’s upward momentum in the latter half of the month.

The renewed interest in privacy coins has strengthened the entire sector. Over the past week, Monero and Dash rose 9.1% and 12.5% respectively, as traders shifted toward these established anonymous assets.

"With tightening global regulations and growing controversy over digital surveillance, privacy has returned to the forefront," added Thakral. "Although Zcash is an established coin, its privacy narrative is clear and concise. Combined with the approaching halving, traders have found an easily accessible, liquid way to gain exposure to this theme."

Sustainability of Rally in Question: Speculation Dominates, Fundamentals Await Validation

However, Thakral also cautioned that the current rally is primarily driven by speculation rather than fundamental growth. The key evidence lies in the limited increase in Zcash’s shielded transaction volume.

He said Zcash’s future trajectory hinges on two critical factors: first, how miners and investors react after the halving; second, whether the privacy narrative can transcend pure speculation to drive real user growth and avoid a reversal sell-off once positive news is priced in.