Grayscale has filed its fourth amended registration statement for the Grayscale Zcash Trust, advancing plans to move the existing investment vehicle from the over-the-counter market to NYSE Arca under the ticker ZCSH.The asset manager submitted Amendment No. 4 to its Form S-3 registration statement with the U.S. Securities and Exchange Commission on August 18. The preliminary prospectus remains subject to completion, meaning the registration has not yet become effective and the proposed NYSE Arca listing is not yet operational. The trust already trades on OTCQX under ZCSH. Under Grayscale’s proposed structure, shares would instead trade on NYSE Arca and be issued continuously through authorized participants, creating an arbitrage mechanism intended to keep the share price closer to the value of the underlying ZEC. The product would hold ZEC directly and seek to reflect the cryptocurrency’s value, less expenses and liabilities. Since April 1, its valuation benchmark has been the CoinDesk Zcash Benchmark Rate, replacing the previous CoinDesk Zcash Price Index.
DCG Affiliate Could Contribute 200,000 ZEC
One of the most significant disclosures in the latest amendment concerns a potential investment by an affiliate of Digital Currency Group, Grayscale’s parent company. The filing says Grayscale and a DCG subsidiary are discussing an arrangement under which the investor would acquire trust shares through an authorized participant or its designee in exchange for approximately 200,000 ZEC after the registration statement becomes effective. The discussions are explicitly non-binding. The potential investor could ultimately contribute more or less than 200,000 ZEC, or make no investment at all. Grayscale nevertheless says the contemplated contribution would represent a substantial portion of the shares representing ownership in the trust.The amendment has not yet specified the final sponsor fee. It does state that Grayscale currently intends to use 100% of sponsor fees received during the first 12 months after registration becomes effective for marketing activities supporting the trust and Zcash Network, although that commitment can be modified or discontinued.
ETF Structure Could Address ZCSH’s Historical Discount
Moving ZCSH onto NYSE Arca could substantially change how investors gain exposure to the trust. Grayscale disclosed that between October 18, 2021 and June 30, 2026, ZCSH traded at premiums as high as 240% and discounts as large as 55% relative to net asset value. Its average premium was 53%, while its average discount was 19%. On June 30, the shares stood at a 17% discount to NAV. The proposed creation-and-redemption system would allow authorized participants to exploit discrepancies between market prices and underlying ZEC value, potentially reducing those deviations. Grayscale used a similar conversion strategy with its Bitcoin trust after GBTC received approval to list on NYSE Arca in January 2024.The Zcash proposal is particularly notable because ZEC is designed around privacy technology, including shielded transactions that can conceal transaction details. A regulated U.S. exchange-traded vehicle would therefore extend the expanding crypto ETP market into a category historically subjected to heightened regulatory scrutiny. For now, however, the fourth amendment represents another procedural step rather than final approval. Grayscale cannot begin selling securities under the registration statement until it becomes effective, and the filing itself warns that its contents remain preliminary and subject to change.