I’d like to know what you think would happen with a Zcash ETF.
Would people prefer the ETF and the network run out of transactions?
Would the Zcash ETF boost the value of Zcash?
I didn’t express myself well. I’d like to know the future of Zcash with the emergence of ETFs.
That’s a good question, I don’t think we really know.
My speculation:
Grayscale has had a Zcash “trust” (ZCSH) since 2019 or so but by it’s nature it was for “accredited investors” only. I think the idea behind converting it to a ETF/ETP is that normal investors like you or I can buy shares.
Same idea behind the Cypherpunk (CYPH), the Winklevoss want to do similar to what they did with Bitcoin, accumulate a certain amount (in this case 5%) of all Zcash and hodl it for long term like Grayscale did.
The goal is for the big boys to hold the actual asset, Zcash, and to issue shares or fractions of shares against it to the public.
Historically we can see that this has been a double edged sword for Bitcoin. Yes it attracted big players on Wall Street and in theory that has been a contributing factor towards the rise to $100k, but Wall Street is less tolerant of wild 40-50% weekly swings so the volatility has settled down. High frequency traders are happy with 5-10% daily movements because they can still make money off them, every trading day.
I would say looking at Bitcoin value now you need to look though a Boomers mindset of traditional stocks/bonds.
I would speculate that Zcash is still in the wild west of value discovery and institutional adoption so expect more volatility, but as the big players get thier orders filled I would guess that volatility will die down.
just my opinion, not financial advice
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I really liked Cypherpunk’s (CYPH) initiative; I believe it would be interesting to have a Zcash ETF, but I’m afraid that this could domesticate Zcash.
Buying cryptocurrencies and storing them in a wallet are complicated things, even if it requires paying an administration fee; instinctively, we prefer the easy option.
That’s a very pessimistic thought, I know, but that’s what I think. I believe I need to see a psychologist to change my thoughts.
On the other hand, there’s the fact that a larger volume of Zcash purchases will be used to compose an ETF. I believe that the more people buy, the more Zcash purchases will occur to compose the Zcash ETF. This could cause the value to rise considerably.
With the migration to POS systems, I believe many people may prefer to buy Zcash directly, but there’s also the possibility that ETFs will start distributing dividends.
I think folks will use options that make sense to them so having alternatives is net good. However, one issue that could arise for the folks who choose self-custody is whether it stays lawful. Will this always be allowed with frictions staying low? Certian parts of the world are headed in the wrong direciton so its unclear to me.
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You’re right. There are different ways to obtain Zcash, and people have different intentions. Each person has their own needs; while some see Zcash as protection against the country’s jurisdiction, others see it as an investment. While some people don’t buy cryptocurrencies directly because it’s complicated, others might buy them because of the ease of buying an ETF and being exposed to fluctuations in a simplified way. Each person has their own motivation; no one thinks the same way as anyone else. Everyone has their own reasons for obtaining Zcash, so having an ETF can democratize access without restricting its use to certain people.
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I think more sophisticated traditional traders, would prefer the ETF over the actual token due to crypto speculation and volatility etc. With the ETF it’s more familiar and a risk management perks with the traditional investors/traders.
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