Grayscale argues that Zcash is the most credible challenger to Bitcoin’s dominance in the digital currency segment, arguing that a relatively petite change in market share could translate into an above-average enhance in the value of the privacy-focused asset.

In the March 18 survey noteZach Pandl, Grayscale’s chief research officer, puts this opportunity in stark terms. Bitcoin still accounts for about 90% of the “cryptocurrency sector,” a segment the company estimates at $1.6 trillion across fifteen assets. In comparison, Zcash is only a fraction of this amount. However, Pandl suggests that the difference may not be structural.

“Bitcoin was the first decentralized digital currency and is still by far the largest currency as measured by market capitalization,” he writes. “However, there are other blockchains where digital currency can be used. Within this competitive set, Grayscale sees Zcash as uniquely positioned to gain traction over time.

Grayscale says Zcash has an 18x advantage

The core of the thesis is based on capabilities that Bitcoin fundamentally lacks. While Bitcoin transactions remain fully crystal clear on the public ledger, Zcash offers protected transactions that hide the sender, recipient and transaction amount.

Pandl argues that this distinction is not merely technical but defines the market. “Zcash offers protected transactions that hide senders, recipients, and balances,” he notes, adding that “we believe privacy will be essential for certain types of users and transactions, and Bitcoin cannot meet this requirement.”

The implications are clear: if demand for private, censorship-resistant payments increases, whether driven by individuals, institutions or specific jurisdictions, Zcash operates in a segment where Bitcoin is structurally narrow. Rather than directly competing across all apply cases, it focuses on a subset of transactions where transparency becomes a limitation rather than a feature.

The second pillar of grayscale is less about design and more about trajectory. Zcash, which has been operating for ten years, is described as entering a fresh phase characterized by increasing apply of privacy features and a renewed inflow of capital.

“Zcash is almost 10 years old, but it seems to be entering a new chapter,” writes Pandl. “The use of shielding technology is increasing, highlighting market interest in privacy-preserving digital currencies. New capital is entering the ecosystem to support wallet development and Zcash mining.”

The evaluative argument flows directly from these two dynamics. The market capitalization of Zcash’s ZEC token is currently approximately $4 billion, representing approximately 0.3% of the broader digital currency segment.

Grayscale’s scenario is deliberately conservative in its assumptions, but aggressive in its consequences. If Zcash acquired just 5% of the same segment, its valuation would enhance approximately eighteenfold. The math is less about absolute growth in cryptocurrency markets and more about relative positioning in an existing category.

Pandl clearly talks about trade-offs. It notes that Zcash is “smaller and more volatile than Bitcoin and therefore has a higher risk profile.” The positive scenario is related to the reallocation of market share, not to a guaranteed enhance in demand.

This view is not isolated. Several prominent figures have recently outlined similarly asymmetric scenarios for Zcash. Cypherpunk Technologies CIO Will McEvoy described Zcash as “the most mispriced cryptocurrency asset,” while Alliance DAO co-founder Qiao Wang called ZEC “the last 1000 times in crypto.” BitMEX co-founder Arthur Hayes predicts ZEC will hit $1,000 as a “first stop,” with a long-term goal of $10,000.

At the time of publication, ZEC was trading at $232.93.

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