ZEC (Zcash) decreased by 4.54% in the past 24 hours, currently at $380.15

Gate News Bot Message, December 18th, according to CoinMarketCap market data, as of press time, ZEC (Zcash) is trading at $380.15, down 4.54% in the past 24 hours, with a high of $468.95 and a low of $373.08. The current market capitalization is approximately $6.251 billion.

Zcash is a privacy-focused digital currency and the first cryptocurrency to implement zero-knowledge encryption technology for private peer-to-peer payments. ZEC uses end-to-end encryption to protect user privacy, offering flexible privacy options through a combination of shielded addresses and transparent addresses. The token features fast transactions and low fees, supporting the sending of private messages within transactions. The Zcash ecosystem has support from multiple mainstream exchanges and offers official applications such as the Zashi wallet for users.

Important recent news about ZEC:

1️⃣ Dynamic fee market mechanism upgrade lays the foundation for network performance improvements

The dynamic fee market proposal proposed by Shielded Labs is driving the iteration of the ZEC network structure. The proposal suggests abandoning the long-standing fixed fee mechanism (currently 1,000 zatoshi) in favor of a dynamic pricing structure based on the median of transactions in the past 50 blocks. The new mechanism will automatically adjust fees according to actual transaction activity, simulating stable load with synthetic comparable objects, making fees more predictable and more effective against spam attacks. This upgrade is expected to be implemented in phases: first with off-chain monitoring, then as a wallet strategy, and finally as a consensus change after approval. This technical iteration demonstrates Zcash’s commitment to improving network efficiency and user experience, providing technical support for mid-term development.

2️⃣ Institutional capital continues to increase holdings and derivative long positions form price support

Over the past week, multiple institutional investors have intensified their strategic positions in ZEC. The Winklevoss brothers’ fund has accumulated 200,000 ZEC since November, worth over $80 million, aiming to hold 5% of circulating supply eventually. Cypherpunk Technologies has established a $100 million ZEC treasury and holds over 200,000 ZEC, further strengthening its strategic position in privacy technology. Reliance Global has shifted its entire digital asset portfolio into ZEC investments. Additionally, large institutional investors have continued to increase margin and expand long positions on derivatives platforms. A newly created wallet address deposited $1.23 million USDC into HyperLiquid on December 15 and opened a 2x leveraged long position of 5,000 ZEC. These institutional strategies reflect strong confidence in ZEC’s long-term prospects and provide a foundation for price support.

3️⃣ Privacy technology regulatory outlook and de-anonymization risks create dual pressures

The narrative around privacy coins currently faces dual impacts from regulatory uncertainty and privacy breaches. The US Securities and Exchange Commission plans to hold a roundtable on cryptocurrencies, financial monitoring, and privacy, with Zooko Wilcox, founder of Zcash, participating as a speaker to assess SEC’s regulatory stance on privacy tech. If consensus is reached among participants that zero-knowledge proofs can meet compliance requirements, this flexibility may be incorporated into digital asset regulatory frameworks. Grayscale has submitted an application to regulators to convert the Zcash trust into a spot ETF tracking the CoinDesk price index. However, the Arkham blockchain tracking platform has de-anonymized over half of Zcash’s protected and unprotected transactions, involving $420 billion in transaction volume, and has tracked approximately 37% of the total balance (about $2.5 billion). This de-anonymization directly undermines market expectations of ZEC’s privacy advantages, exerting noticeable downward pressure on the price.

4️⃣ Overall weakness in the privacy coin sector and Bitcoin’s negative correlation limit independent rebound

ZEC’s recent performance has been constrained by the overall weakness of the privacy coin sector. Monero (XMR) and Dash (DASH) have experienced varying degrees of correction over the past week, weakening short-term confidence in the sector and making independent rebounds for ZEC more difficult. From a correlation perspective, ZEC’s correlation coefficient with Bitcoin is -0.47, showing a clear inverse relationship. As Bitcoin shows signs of recovery, this negative correlation directly limits ZEC’s upside potential. Technically, ZEC has repeatedly tested the $390–420 range, indicating the market has entered a structural convergence phase. The $400 support level has been tested multiple times in the past week; frequent testing may weaken this support and increase the likelihood of a short-term breakdown.

This message is not investment advice; please be aware of market volatility risks.