Delphi Digital researcher Simon Shockey is arguing that the real story in Zcash is no longer just its price \u2013 despite ZEC having one of the most eye-popping rallies of this cycle in recent months. \u201cThe most interesting thing about ZEC today is not the price,\u201d he wrote on X. \u201cIt\u2019s the fact that a GBTC-style discount dislocation just appeared around ZCSH.\u201d<\/p>\n
For Shockey, the Zcash trust setup only makes sense when viewed through the lens of what happened with Grayscale\u2019s Bitcoin product. He reminds readers that \u201cfunds were built, and later blown up, on two different GBTC trades.\u201d The first was the premium arbitrage<\/a>, where Grayscale allowed accredited investors to subscribe at NAV with a six-month lock while GBTC traded at a \u201c~30\u201340%\u201d premium in public markets.<\/p>\n The playbook, he writes, became almost mechanical: \u201csubscribe at NAV, lock for six months, hedge BTC exposure with CME shorts, sell GBTC at a premium, pocket the spread and lever it.\u201d It was so widely adopted that \u201cevery TradFi family office, hedge fund tourist, and crypto-native desk was running it. It became the trade. Until, well, it didn\u2019t\u2026\u201d<\/p>\n In February 2021, after years of trading rich to NAV, GBTC flipped to a discount<\/a>. Anyone mid-lockup was now long an over-priced wrapper, paying to maintain a hedge and watching the discount widen to \u201c-30%, -40%, even -45%.\u201d Shockey calls that dislocation \u201ccareer\/cycle-ending almost overnight,\u201d and notes that it helped detonate players like 3AC, BlockFi<\/a>, Genesis and DCG.<\/p>\n But he stresses that GBTC\u2019s story had a second act: once the discount was entrenched, \u201ca different trade emerged: buy GBTC at a discount, wait for regulatory clarity or ETF approval, redeem at NAV, capture the collapse in the discount.\u201d Value-oriented funds \u201cwere early and underwater for a while. But they were ultimately right. The discount evaporated as ETF approval became inevitable.\u201d<\/p>\n Shockey\u2019s contention is that a structurally similar phase may now be opening around Grayscale\u2019s Zcash trust. \u201cThis morning Grayscale filed to convert ZCSH, their Zcash trust, into an ETP,\u201d he writes. \u201cThat filing immediately creates the early outline of a GBTC-style discount trade.\u201d<\/p>\n He highlights that ZCSH recently traded around 33.50 dollars per share, even though \u201cyesterday\u2019s trust data, with a lower ZEC price, showed NAV around forty-one dollars per share.\u201d By his math that is \u201cstill close to a 20 percent discount. Every ZCSH share is priced materially below the ZEC it represents.\u201d With an implied 0.0817 ZEC per share, \u201cyou are effectively getting ZEC exposure at ~$410 per ZEC when spot is well above that.\u201d<\/p>\n The key structural shift is the proposed move from a closed trust to an exchange-traded product with redemptions. \u201cThe current trust structure does not allow redemptions,\u201d Shockey notes. \u201cThe proposed ETP would, with one-to-one withdrawals of the actual ZEC held.\u201d If regulators sign off, \u201cthe discount should tighten and ZCSH should move toward NAV. This is exactly what happened with GBTC as ETF approval became more realistic.\u201d He is careful to add: \u201cNot guaranteed. Not the same trade. But structurally very similar.\u201d<\/p>\n On the money-making angle, Shockey is explicit. \u201cThe discount closing is the cleanest angle. Buying ZCSH at a 20 percent discount and selling after convergence is the purest version of the trade.\u201d Beyond that, \u201cthere is optionality if ZEC rerates during the approval window. If the privacy-oriented store-of-value narrative strengthens, ZEC can rise while the discount closes. That creates a second leg of upside that GBTC did not offer until very late.\u201d<\/p>\n He argues that a ZEC ETP \u201ccould unlock new demand,\u201d since \u201cmost funds\/investors cannot hold ZEC directly due to custody and mandate issues. An ETP solves that. New pools of capital often tighten discounts by themselves.\u201d<\/p>\n Narrative and political tailwinds, in his view, are real. \u201cBitcoin\u2019s lack of privacy is back in focus. The quantum-risk discussion is getting louder.\u201d He points to mainstream airtime, including comments from VanEck\u2019s CEO about Bitcoin\u2019s shortcomings and ZEC as a potential hedge, as a signal that the story has escaped pure crypto-Twitter.<\/p>\n His closing summary captures the asymmetric, time-bounded nature of the bet: \u201cIf markets keep leaning toward the idea that ZEC is absorbing the role Bitcoin stepped away from, then ZCSH becomes the cleanest vehicle to express that view. You get ZEC exposure in public markets, which could become a major driver of rerating as flows pick up, plus a built-in twenty percent discount that only exists until the ETP is approved. ZODL?\u201d<\/p>\n At press time, Zcash traded at $509.84.<\/p>","protected":false},"excerpt":{"rendered":" Delphi Digital researcher Simon Shockey is arguing that the real story in Zcash is no longer just its price \u2013 despite ZEC having one of the most eye-popping rallies of this cycle in recent months. \u201cThe most interesting thing about ZEC today is not the price,\u201d he wrote on X. \u201cIt\u2019s the fact that a […]<\/p>\n","protected":false},"author":0,"featured_media":116201,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-116200","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-discovery"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/116200"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=116200"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/116200\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/media\/116201"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=116200"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=116200"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=116200"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Will Zcash Follow The GBTC Playbook?<\/h2>\n