- Zcash’s market cap share versus Bitcoin rose from below 0.1% to about 1.5% over the past year.
- Grayscale says Zcash could capture more market share as demand for privacy-preserving technology grows.
- XRP’s nearly 6% share provides context for Zcash’s current 1.5% position and historical crypto market cycles.
Zcash has increased its share of Bitcoin’s market capitalization from less than 0.1% to approximately 1.5% over the past year. Grayscale Research believes the privacy-focused cryptocurrency could capture more market share as demand for privacy-preserving technology grows. In a report, Grayscale Head of Research Zach Pandl said Zcash’s gains have not exhausted its potential market.
Zcash Expands Its Position Among Digital Currencies
Zcash has climbed from around $60 per token to approximately $1,500 over the past year. Despite this increase, Pandl said Grayscale Research does not believe the token has reached a valuation ceiling.
He attributed the rise to Zcash’s low starting price and what Grayscale considers its large addressable market. Zcash and Bitcoin both belong to the Currencies Crypto Sector, which includes blockchains focused on digital currency use cases.
Bitcoin remains the largest asset in this category, which contains 10 other qualifying tokens. These include Zcash, XRP and Litecoin, alongside other cryptocurrencies.
Grayscale’s comparison shows Zcash’s market capitalization has grown substantially relative to Bitcoin. However, Pandl noted that its current share remains below levels reached by other cryptocurrencies during previous market cycles.
XRP and Other Tokens Provide Market Context
XRP currently represents nearly 6% of Bitcoin’s market capitalization, according to Grayscale Research. During the 2017–2018 market cycle, XRP, Bitcoin Cash, Litecoin and Dash each reached at least 3% of Bitcoin’s market capitalization.
Zcash’s current share of approximately 1.5% remains below those historical levels. Pandl cited these comparisons to illustrate the range of market shares that competing cryptocurrencies have previously achieved.
Grayscale identifies Zcash as a Bitcoin-like digital currency with additional privacy features. Its research also groups XRP, Litecoin, Bitcoin and Zcash among assets with digital currency use cases.
Grayscale Links Future Growth to Privacy Demand
Pandl said Grayscale expects demand for privacy-preserving technologies to continue growing. The firm believes Zcash could gain further market share if it maintains the most effective privacy features among competing cryptocurrencies.
Grayscale’s assessment focuses on Zcash’s position within the digital currency sector and its potential addressable market. Pandl said the token’s recent appreciation reflects its earlier low valuation and the market it could serve.
