Privacy coin sector revival: ZEC and DASH lead the gains, Grayscale ETF expected to ignite the market

On April 10, 2026, the crypto market witnessed a landmark trading day. Privacy coins, represented by Zcash (ZEC) and Dash (DASH), led the rally against the trend, with ZEC surging over 17% in a single day and DASH climbing more than 12% simultaneously, making them the standout performers among all market assets. This rally was not an isolated technical rebound but the result of multiple narratives stacking together—expectations of continued enthusiasm for Grayscale’s privacy coin ETF, Dash Evolution’s chain integration of Zcash privacy technology, Barry Silbert’s prediction on Bitcoin capital flow into privacy tracks, and the launch of Midnight privacy Layer 1 mainnet—all forming a catalytic matrix for the privacy sector’s revival. This article will systematically analyze this phenomenon from four dimensions: event review, data breakdown, technological evolution, and industry logic.

Multiple Catalysts Resonating for a Market Explosion

On April 10, 2026, the two major privacy coins, Zcash (ZEC) and Dash (DASH), simultaneously initiated upward movements during Asian trading hours, continuing their gains into the European and American sessions.

According to Gate’s market data (as of April 10, 2026), ZEC reached a high of about $389.83, a low of about $308.32, and closed at $375.7, with a 24-hour increase of 17.11%. The 24-hour trading volume was approximately $8,010,000. From a weekly perspective, ZEC’s total gain over the past 7 days was 58.51%, over 30 days 75.97%, and over the past year approximately 894.34%. Its current market cap is about $62.6 billion, circulating supply is 16,640,000 coins, with a max supply of 21 million coins, accounting for 0.24% of the market share.

DASH, on the same day, hit a high of about $40.87, a low of about $31.8, and closed at $40.49, with a 12.66% increase over 24 hours and a trading volume of roughly $1,930,000. Over the past 7 days, DASH’s cumulative increase was 32.33%, over 30 days 25.66%, and over the past year approximately 98.39%. Its current market cap is about $506 million, with a circulating supply of 12,650,000 coins and a market share of 0.019%.

The immediate trigger for this rally was the resonance of multiple events. On November 26, 2025, Grayscale submitted an S-3 registration statement to the U.S. Securities and Exchange Commission (SEC), planning to convert its Zcash Trust (ZCSH) into a spot ETF listed on NYSE Arca. On January 15, 2026, the SEC concluded its investigation into Zcash without enforcement recommendations, clearing a key hurdle for approval. On February 14, 2026, Grayscale’s Chief Legal Officer Craig Salm publicly endorsed Zcash at the Hong Kong Consensus conference, describing its technical features as “very interesting” and explicitly stating that they are advancing the trust-to-ETF conversion. The combination of regulatory good news and technological catalysts was priced into the market in early April.

Market Structure Analysis: Trading Volume, Positions, and Short Squeeze

Beyond price performance, three notable signals emerged from the market structure in this round of rally.

First, trading volume significantly expanded. During ZEC’s surge in early April, 24-hour trading volume once soared to about $740 million, a 77% increase over previous averages. This sharp increase indicates inflows of new capital rather than mere redistribution among existing holders.

Second, there was a clear divergence between open interest and funding rates. During the same period, ZEC’s open contracts increased by about 26%, while the funding rate remained in negative territory. This divergence signals that, despite the rising price, many short positions remained open, and major funds were fueling these shorts’ margins, creating a typical short squeeze pattern. Data shows that ZEC experienced about $12.65 million in short liquidations within 24 hours.

Third, on-chain privacy pool data confirmed genuine demand growth. The proportion of shielded transactions in ZEC has risen to 86.5%, with shielded supply reaching a record high of approximately 516,000 coins. The continuous growth of tokens locked in shielded pools indicates that more holders are not just speculating but actively utilizing ZEC’s privacy features.

It’s important to note that the short squeeze pattern described above may continue to drive short-term price volatility, but its sustainability depends on subsequent capital inflows and the pace of fundamental developments like ETF approvals.

Technical Perspective: Key Resistance and Support Zones

Based on Gate’s market data, ZEC’s price action on April 10 displayed clear technical formations. On the daily chart, ZEC broke through the previous consolidation range of about $250 to $280, with the current price around $375.7, reaching levels not seen since the high-pressure regulatory environment of 2024. Historical data shows ZEC’s all-time high at $3,191.93, so current levels still have a significant distance from the peak.

From resistance and support perspectives, the $380–$390 zone above is a previous accumulation area; whether it can be broken depends on volume support. The $300–$285 zone below served as a neckline in prior breakouts; a rebound and stabilization there could serve as a bullish support reference. If this support fails, the next support level is around $275.

For DASH, technical signals also show a breakout. Market analysis indicates that on April 10, DASH’s rally, accompanied by about $1.93 million in volume, broke through the long-standing lower channel’s upper boundary. This technical breakout, combined with the fundamental catalyst of Evolution chain’s privacy upgrade, provided dual support from technical and narrative perspectives.

Reconstructing the Grayscale ETF Logic

Craig Salm’s comments at the Consensus Hong Kong conference further outlined the regulatory shift’s logic: Zcash’s “selective disclosure” mechanism—via the “view key” feature—allows users to choose to disclose transaction information to specific entities (like tax authorities) while maintaining complete privacy from external observers. This approach cleverly positions privacy coins as compatible with compliance, transforming them from “tools for regulatory evasion” into “necessary infrastructure for enterprise-level operations.”

Grayscale’s Zcash Trust holds about 5% of the circulating ZEC, roughly $137 million in assets, with a management fee of 2.5%, administered by The Bank of New York Mellon. If the ETF conversion is approved, ZEC will become the first privacy coin-based ETF listed in the U.S. stock market, symbolizing a significant milestone and capital channel.

Sector Landscape: Divergence Among Privacy Coins

The privacy sector currently shows a clear divergence pattern, driven by differences in technical architecture and compliance strategies.

Zcash’s “selective disclosure” architecture strikes a differentiated balance between privacy and compliance. Grayscale’s choice of Zcash over larger market cap assets like Monero for its privacy ETF is based on this compliance logic. Salm specifically pointed out that under the U.S. CLARITY Act framework, Zcash’s “opt-in” privacy mode places it in a more favorable regulatory position compared to fully anonymous coins like Monero.

Technical Synergy: Dash Evolution Integrates Zcash Privacy Protocol

In February 2026, Dash announced it was integrating Zcash’s Orchard privacy protocol into Evolution chain.

Orchard, launched in 2022, is built on the Halo 2 cryptographic system and is Zcash’s core privacy engine, relying on zero-knowledge proofs to present funds as encrypted on-chain notes. Dash’s team needs to address the integration challenge of its hybrid PoW/PoS consensus mechanism with Zcash’s proof-of-work system.

This technical synergy is significant. For Dash, the Evolution chain’s original transparency did not fully meet privacy user demands; integrating Orchard can fill this gap. Dash plans to launch privacy transfer features soon and develop privacy tokens that hide balances and transaction histories using zero-knowledge proofs. For Zcash, Dash’s adoption of its privacy protocol serves as a market validation, reinforcing Zcash’s position as a privacy technology leader.

The convergence of their privacy tech routes also reflects a structural shift within the privacy sector—from fragmented exploration to de facto standardization of technical solutions. zk-SNARKs and its derivatives are gradually becoming the mainstream technical paradigm in the privacy track.

Narrative Evolution: Reassessing the Value of Privacy Coins

In February 2026, Barry Silbert, founder of Digital Currency Group (DCG), expressed a controversial view at the New York Bitcoin Investor Week: over the next few years, 5% to 10% of Bitcoin’s total supply will flow into privacy-focused assets like Zcash. He argued that as on-chain analysis tools mature, the narrative of Bitcoin as “anonymous cash” has weakened, and transaction traceability has become a reality; unless the dollar system experiences a structural collapse, Bitcoin’s exponential growth potential is limited, while projects focused on privacy could offer higher multiple returns.

This prediction’s underlying logic is noteworthy. Privacy tech is evolving from a niche “geek preference” to a fundamental “financial sovereignty infrastructure.” Grayscale refers to this field as “financial privacy” rather than “privacy coins,” emphasizing that privacy is not about regulatory evasion but a basic right for individuals and enterprises in the digital age. Their research estimates that if ZEC accounts for just 5% of the crypto “currency” market, its valuation multiple would change significantly.

The launch of Midnight privacy Layer 1 further confirms this trend. Developed by Cardano founder Charles Hoskinson, Midnight uses zero-knowledge proofs to build a “public-private dual ledger” architecture, with a selective disclosure mechanism. Information is encrypted by default but can be accessed under authorized conditions for compliance scenarios. The network launched its mainnet in the last week of March 2026. In early April, the NIGHT token was listed on Launchpool, further boosting market attention to the privacy sector.

Scenario Analysis: Three Possible Evolution Paths

Based on current market structure and regulatory environment, the future evolution of the privacy sector can be summarized into three scenarios.

Scenario 1: Optimistic. SEC approves Grayscale Zcash ETF conversion application in Q2 2026. If realized, ZEC would become the first privacy coin spot ETF in the U.S., providing traditional financial institutions with a compliant privacy asset allocation channel. This could trigger a threefold chain reaction: first, institutional capital flows into ZEC via ETF, reshaping its holder structure; second, ETF approval sets a regulatory precedent for other privacy projects, accelerating sector institutionalization; third, ZEC’s market liquidity improves further, expanding derivatives and ecosystem activities. Industry expectations currently lean toward SEC making a decision in Q2 2026.

Scenario 2: Neutral. SEC approval is delayed or requires additional documentation, leading to a market expectation game. In this case, ZEC and DASH prices will be more influenced by market sentiment and macro liquidity, with higher volatility. The review process for ETF applications often has significant flexibility, and the regulatory complexity of privacy coin ETFs exceeds that of traditional crypto assets, making approval uncertain.

Scenario 3: Pessimistic. If SEC rejects the ETF application or global regulation tightens (e.g., EU AMLR coming into force early, or more countries banning privacy coins), valuation logic for the privacy sector may be re-priced. Notably, about 85% of the current market share in the privacy sector is concentrated in Monero and Zcash, so the overall resilience of the sector remains somewhat centralized. In this scenario, fully anonymous coins may continue shrinking into DEXs and P2P markets, while compliant privacy coins seek alternative pathways outside ETFs.

Regardless of which scenario unfolds, privacy technology—especially zero-knowledge proofs—has long-term commercial application potential beyond crypto assets. Market forecasts suggest the global ZKP market could reach approximately $75.9 billion by 2033. This indicates that the long-term value of the privacy sector depends not only on token prices but also on whether privacy tech can address enterprise-level data protection within compliant frameworks.

Conclusion

The rally on April 10, 2026, is not an endpoint but a signal—indicating that the privacy sector is emerging from regulatory shadows and re-entering mainstream narratives. Grayscale’s ETF application, Dash Evolution’s tech integration, Silbert’s capital flow prediction, and Midnight’s mainnet launch collectively form a clear trend: privacy technology’s application within compliant frameworks is moving from the periphery to the center. However, each step involves regulatory negotiations, technological validation, and market expectations adjusting dynamically. For participants following this sector, understanding the narrative shift of privacy coins from “anonymity tools” to “financial privacy infrastructure” may be more valuable in the long run than chasing short-term price swings.