A cohort of early Bitcoin proponents is quietly placing a big bet on privacy. According to the Wall Street Journal, Gemini co-founders Cameron and Tyler Winklevoss, together with Digital Currency Group (DCG) founder Barry Silbert, are aggressively accumulating Zcash (ZEC), a privacy coin that uses zero-knowledge proofs (zk-SNARKs) to shield transaction details. They believe this feature brings the network closer to Satoshi Nakamoto's original vision of electronic cash, which Bitcoin's transparent ledger now struggles to fulfill.
The Winklevoss brothers' treasury firm Cypherpunk, launched in November last year, currently holds roughly 290,062 ZEC, representing about 1.76% of the circulating supply. Their target is to reach 5% of total supply (21 million coins). Tyler Winklevoss recently published and validated a valuation model comparing ZEC to gold and Bitcoin, projecting a potential price of $9,700 per coin — over 15 times the current $597 level. Silbert went further, describing Zcash as Bitcoin circa 2013, and predicting that 5-10% of Bitcoin capital could flow into privacy coins.
DCG's Full Suite: Mining Pool and ETF Filing
Silbert is backing his words with action. DCG's mining arm Foundry launched an institutional-grade Zcash mining pool in April, capturing nearly one-third of newly mined coins within weeks. On May 8, Grayscale, also under DCG, filed an S-3 form with the SEC to convert its Zcash Trust — which manages over $200 million in assets — into a spot exchange-traded fund (ETF) under ticker ZCSH, proposed for listing on NYSE Arca. If approved, it would be the world's first spot ETF for a privacy coin.
Approval is far from guaranteed. Approximately 30% of ZEC's supply resides in shielded pools, where transactions are fully encrypted. Regulators will scrutinize how custodians prove reserves and comply with anti-money laundering (AML) rules. Grayscale's choice of a trust-to-ETF conversion rather than a brand-new filing reflects a cautious approach to navigating these hurdles.
Short Squeeze: One Disclosure Triggered $62M in Liquidations
The influence of institutional holdings became starkly evident when Multicoin Capital publicly disclosed a large ZEC position. The announcement sparked a 30% intraday surge, triggering $62 million in futures liquidations — predominantly shorts. Such a concentrated liquidation event underscores ZEC's relatively thin liquidity and vulnerability to large holder disclosures.
Despite this volatility, ZEC has delivered stellar returns: up 49% in the past month and over 1,400% year-to-date. Its market capitalization has swelled to nearly $10 billion, grabbing a spot among the top 15 crypto assets. The entire privacy coin sector has surpassed $24 billion in total market cap.
73 Exchanges Delist — Yet the Market Roars
The institutional embrace of privacy coins unfolds against a tightening regulatory backdrop. In 2025, a total of 73 exchanges delisted privacy coins, up 43% from two years earlier. Japan, South Korea, and India have completely banned privacy coin listings, while the EU's MiCA framework and DAC8 tax reporting directive took effect in January, raising compliance costs. Yet ZEC's price performance tells a completely different story, as investors appear to prioritize technological features over regulatory rhetoric.