Zcash (ZEC) has lost roughly 68% of its value since peaking at $744 in November, falling to around $235 on Thursday - and the Winklevoss-backed treasury firm that aggressively accumulated the token has stopped buying.
At the same time, Digital Currency Group founder Barry Silbert is predicting that 5-10% of Bitcoin's market capitalization will rotate into privacy coins like Zcash over the coming years.
The competing dynamics - institutional buyer on pause, influential backer talking his book - capture the tension at the center of the privacy coin sector right now.
The Crash
ZEC was the top-performing large-cap cryptocurrency of 2025, surging over 1,200% from September lows before reversing hard.
The token has dropped roughly 38% in the past month alone, according to CoinGecko data. It hit a four-month low below $220 on Feb. 5 before bouncing.
Cypherpunk Technologies, the Winklevoss-backed firm that adopted a Zcash treasury strategy in November, has not disclosed a new purchase since Dec. 30. The company holds 290,062 ZEC - about 1.76% of circulating supply - at an average cost of $334 per token. At current prices, that position is roughly $26 million underwater, according to The Defiant.
Cypherpunk's stated goal of accumulating 5% of Zcash's supply appears on hold. Meanwhile, its own shares have dropped about 40% in the past month.
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The Bull Case
Silbert made his prediction Wednesday at Bitcoin Investor Week in New York, calling privacy coins "the next asymmetric bet" with potential for 100x to 1,000x returns.
He said Bitcoin "lost the plot" on privacy as blockchain analytics firms like Chainalysis made its transactions traceable, and argued ZEC could also serve as a hedge against quantum computing threats.
If 5-10% of Bitcoin's current $1.3 trillion market cap rotated into privacy coins, that would imply $65-130 billion in new capital - dwarfing Zcash's $3.9 billion market cap today.
The Conflict
Silbert's DCG owns Grayscale, which runs the Grayscale Zcash Trust - launched in 2017 - and is actively working to convert it into a spot ETF.
Any price appreciation in ZEC directly benefits DCG's portfolio and Grayscale's fee revenue.
Silbert did not address that overlap during his remarks. The pitch also arrived the same week that Cardano's Charles Hoskinson announced a competing privacy blockchain, Midnight, launching in late March - adding another entrant to a sector that remains small relative to the ambitions staked on it.
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