From historical patterns, the hidden concerns behind ZEC's surge: when a 100% annualized ROI becomes a risk signal

Over the past two months, Zcash (ZEC) soared from $50 to a historic high of $730, with an astonishing increase. But as we return to the fundamentals of the chain, a more complex story gradually emerges.

The Illusory Prosperity of Mining Economics: The Harvest Game Behind Ultra-High ROI

The sustainability of any PoW project first depends on the economic incentives on the mining side. Currently, the mainstream market-leading Bitmain Antminer Z15 Pro specifications are as follows:

• Hashrate: 840 KH/s
• Power Consumption: 2,780 W (actual operation around 2,560 W)
• Energy Efficiency: 0.302 KH/W
• Price: $4,999 (official futures, delivery in April 26, 2026)

Based on current data, the net daily profit per Z15 Pro can reach $60. Assuming a 5-year amortization of the mining machine, the break-even period is only about 89 days, with an annualized return of up to 410%. This figure is extremely rare in the entire PoW history:

• BTC miners typically break even in 12–24 months
• ETH PoW era break-even cycles ranged from 300–600 days
• Any PoW project with a break-even cycle under 120 days (FIL, XCH, RVN, etc.) has almost always experienced sharp corrections after a surge

Such ultra-high ROI is often a warning sign of risk, not an opportunity.

History repeats itself with the same script. In May 2021, Chia’s XCH price soared to $1,600, and the static break-even period for mining rigs was compressed to under 130 days, triggering a global hard drive buying frenzy. But when large quantities of hard drives actually came online, the network’s hash rate growth far exceeded the price increase, and the break-even period quickly extended to over 3,000 days.

Similar stories also occurred with Kaspa (KAS). In mid-2023, the break-even period for IceRiver KS1 miners once dropped to 150 days, but due to hash rate growth outpacing price gains, the break-even period eventually soared to 3,500 days. This indicates that even if the price remains strong, when difficulty increases exponentially, miners cannot escape losses.

Network Security: An Underestimated Structural Risk

Beyond mining economics, another decisive factor is ZEC’s network security.

Currently, ZEC’s total network hash rate is about 13.31 GSol/s. Based on a single Z15 Pro’s hashrate of 0.00084 GSol/s, it would take approximately 14,857 such miners to constitute the main network, with energy consumption around 40 MW—roughly the scale of a small to medium Bitcoin mining farm.

What does this mean? The threshold to launch a 51% attack is extremely low:

• Each Z15 Pro futures cost about $5,000, with discounts for large orders
• Controlling 50% of the network’s hash rate requires about 8,000 miners, costing approximately $40M —if purchasing second-hand or leasing equipment, the actual cost could be just a few million dollars

On a public chain with an FDV close to $6.6 billion, a million-dollar investment is enough to threaten the entire network’s security.

Compared to mainstream PoW chains, the severity of the problem becomes even clearer. ZEC’s current hashrate is not only far below that of Bitcoin, Litecoin, and other major chains, but even chains that have been successfully attacked with 51% attacks, such as Ethereum Classic (ETC) and Bitcoin Gold (BTG), generally have higher hashrates than ZEC. This means ZEC has entered a dangerous zone where it can be attacked.

On-Chain Data: The Huge Gap Between Usage and Valuation

Although recent narratives around ZEC have heated up in the community, on-chain data tell a very different story:

• Average daily transaction volume: 15,000–18,000 transactions/day, only 1%–2% of mainstream public chains
• Privacy feature usage: shielded transactions account for less than 10%, most transactions are still transparent
• Number of holding addresses: 6,291, reflecting a limited user base

These data points indicate that ZEC’s actual network activity is far from the usage implied by its valuation. A blockchain claiming to focus on privacy has less than 10% of transactions utilizing privacy features, which is itself a cause for concern.

Rational Thinking When Calm Returns

Narratives, emotions, celebrity effects, and mining economics have pushed ZEC to the peak of public opinion. But returning to the three core dimensions of blockchain—economic sustainability, network security, and actual adoption—ZEC presents a worrying picture:

• An annualized ROI of 410% often signals impending mining difficulty adjustments and price corrections
• Weak hash rate foundation that can launch a 51% attack with just a few million dollars
• Monthly transaction volume and daily active addresses far below mainstream chains, with privacy feature usage under 10%

History repeatedly proves that narratives and emotions can create short-term price myths, but fundamentals ultimately determine how far these myths can go. When the market cools from frenzy to rationality, projects lacking real usage scenarios and network security are often faced with the most turbulent price corrections.

The current ZEC price of $399.41, compared to its previous $730 high, has already retraced, which may be the beginning of market rationality correction.