Grayscale Files SEC Application to Convert Zcash Trust Into Spot ETF

Grayscale, the leading cryptocurrency asset manager, has taken a significant step toward expanding ZEC’s institutional accessibility by filing a Form S-3 registration statement with the Securities and Exchange Commission (SEC). The filing reveals the company’s intention to convert the Grayscale Zcash Trust into a spot ETF, marking another milestone in the cryptocurrency industry’s shift toward mainstream financial products.

SEC Filing Details: Understanding the Conversion Structure

The formal conversion application, submitted in late November, proposes to list the transformed product on NYSE Arca under the new ticker symbol “ZCSH,” with the official name becoming “Grayscale Zcash Trust ETF.” According to the SEC filing, each basket unit comprising 10,000 shares would require approximately 817.0998 ZEC tokens. Currently, ZEC trades at $388.87, making the implied value of each basket roughly $317,000—significantly higher than the $90,000 threshold often referenced in similar ETF conversions.

The filing discloses critical operational details: Coinbase Custody will serve as the fund’s custodian, ensuring secure asset safekeeping, while Coinbase has been designated as the prime broker. This combination represents a robust institutional framework, leveraging Coinbase’s extensive experience in digital asset custody and trading infrastructure.

Redemption Policy and Future Flexibility

The trust structure is established as a Delaware statutory trust, with the fundamental objective of mirroring ZEC’s price performance while accounting for management fees and associated liabilities. Currently, the ETF framework supports cash-only redemptions—meaning investors can exit positions by receiving USD rather than physical ZEC tokens. However, the filing indicates that physical redemptions may become available in the future, contingent upon obtaining necessary regulatory approvals and market conditions.

This flexibility reflects how institutional-grade crypto products are evolving, balancing regulatory requirements with investor preferences for operational convenience.

What This Conversion Means for ZEC Ecosystem

The transformation from a traditional trust structure to a spot ETF carries substantial implications. By converting to ETF status, the product gains improved tax efficiency, lower minimum investment requirements for institutional investors, and potential inclusion in mainstream investment portfolios. The NYSE Arca listing elevates Zcash’s profile within traditional finance, signaling growing confidence in ZEC’s long-term utility and security.

With Coinbase Custody and institutional-grade infrastructure backing this conversion, ZEC holders can expect enhanced liquidity and broader market participation as the product becomes available to a wider investor base through traditional brokerage platforms.