Zcash ETF ZCSH, listed on NYSE Arca, announced on Sept. 18 that it will carry out a 3-for-1 share split. Each share held will become three shares, while the total value of a holder’s position stays the same. The move is a formal adjustment, not an increase in assets.
Timeline and what stays unchanged
According to an 8-K exhibit filed with the U.S. Securities and Exchange Commission, the process is split into three stages. Holders of record will be determined at the close on Sept. 28. Additional shares will be distributed after the close on Sept. 29. Trading on a post-split basis will begin before the market opens on Sept. 30.
After the split, the fund will continue to trade on NYSE Arca under the ticker ZCSH, and its CUSIP will remain unchanged. For every one share held on the record date, investors will receive two additional shares. Each post-split share will represent roughly one-third of the pre-split net asset value per share.
Filing example shows no change in total value
The filing includes a table to illustrate the effect. An investor holding 10 shares before the split, assuming a net asset value of $300 per share, would have a total position worth $3,000. After the split, that position would become 30 shares at $100 each, with the total value still at $3,000.
The announcement states that the split "will not change the total value of shareholders’ investment." Its expected effect is to lower the price per share while increasing the number of shares outstanding on a proportional basis.
Why the fund is splitting shares
The report says share splits are typically used when a rising per-share price makes smaller purchases less convenient. The fund was listed on NYSE Arca only in August this year. On Sept. 8, it said assets under management had exceeded $500 million.
The underlying asset has also posted a notable rise during this period. When Chain News reported on Sept. 7, ZEC had just moved above $1,200. At the time this article checked, it was trading above $1,480.
The split does not change the fund’s ZEC holdings
The article notes that the split itself does not signal anything about future price action. It changes the share count and the nominal price per share, but it does not change the amount of ZEC held by the fund, and it does not change the value of any holder’s position.
Zcash protocol updates arrived in the same week
Recent changes on the Zcash protocol side are unrelated to the ETF, though the timing is close. Results of the community poll on the NU7 upgrade were released on Sept. 14, confirming that the target block interval will be reduced from 75 seconds to 25 seconds, the current halving mechanism will remain in place, and the original Sprout shielded pool will be shut down when NU7 is activated.