In less than a month, ZEC surged from around $486 in mid-August to over $1,200 at one point, a gain exceeding 150%. ZEC is an older asset launched in 2016, with its codebase forked from Bitcoin and a total supply cap also set at 21 million coins. Its key distinction is the introduction of shielded transactions based on zero-knowledge proofs, which can hide the sender, receiver, and amount in a transaction. This is the origin of its identity as a 'privacy coin'. This rally propelled it into the top ten by market capitalization.
The Old Grudges Between Two Veterans
As soon as the price spiked, two old grievances related to Zcash were simultaneously dredged up. Wang Chun, co-founder of F2Pool, stated on X that six years ago, he blocked the entire team because they couldn't even figure out time zones, calling it one of the "most correct decisions" he's ever made to this day. 'Shenyu', co-founder of the crypto custody platform Cobo and mining pool F2Pool, also shared his story: On the night of the mainnet launch in 2016, just as he mined a bit of ZEC, a lightning strike hit the transformer at his home mining farm. Since then, he has been psychologically scarred and has never held ZEC in his personal wallet again.
The price and the criticism rose almost in sync.
Airing old grievances was just the opening act. Half an hour later, Wang Chun posted a longer tweet, breaking down his dissatisfaction with Zcash into four more specific arguments—from the launch mechanism to recent security incidents, listing them one by one.
The 'Take' Never Stopped
Wang Chun's first argument is: A coin that directly writes a self-enrichment clause into its block reward should not be packaged as a "clean" and neutral currency. This refers to Zcash's post-mainnet launch design—unlike Bitcoin, whose block reward goes solely to miners, Zcash's did not. For the first four years after the mainnet launch, 20% of each block reward was allocated as the "Founders' Reward," distributed to founders, employees, advisors, and early investors. Over four years, this amounted to approximately 2.1 million ZEC, or 10% of the 21 million total supply cap. According to the original design, this 'take' was supposed to last only four years, ending in 2020—after which Zcash would become an asset as "clean" as Bitcoin: all block rewards would go to miners, with no team or institution taking a cut from the new supply.
However, when the 'take' was actually set to expire in 2020, the community voted to pass ZIP 1014, which renewed the same 20% block subsidy under the name of a "Development Fund," to be distributed until 2024 to Bootstrap, the Zcash Foundation, and several major grant programs. The mechanism of allocating 20% of the block subsidy to non-miners did not truly disappear with the expiration of the "Founders' Reward"—the name changed, the recipients changed, but the fact that "20% is taken from each block before miners get their share" has never truly ended for Zcash.
Privacy is Not the Default
Zcash's most touted technology is zero-knowledge proofs, which theoretically can completely hide transaction details. But the protocol itself does not enforce privacy—users are free to choose between shielded (private) addresses or transparent addresses. Some wallets and exchanges, for compatibility reasons, still only support transparent addresses to this day. Zcash officially acknowledges that to truly achieve transaction privacy, one needs to actively choose services that default to shielded transactions.
This means that Zcash's privacy capability does not equate to all ZEC circulation being inherently private. "Optional privacy" and "default privacy" are two different things; the former is more like a feature toggle, while the latter is a protocol commitment—and what Zcash has offered for ten years has always been the former.
Team's Collective Departure
In January 2026, the Electric Coin Company (ECC) team, responsible for Zcash's core development, collectively resigned. ECC cited irreconcilable differences with the Bootstrap board, the governing body, forcing them out; Bootstrap attributed the conflict to governance arrangements and the legal constraints of a non-profit organization. Two months later, both parties reached an agreement. ECC phased out its operations, transferring technical assets to a newly formed team. The project itself did not halt.
The storm subsided, but the fact that a company developing the protocol and holding core technical assets could clash with the Bootstrap board within its governance system to the point of collective resignation itself indicates that this governance structure still has a way to go before reaching "maturity."
Security Vulnerability
Security researcher Taylor Hornby discovered on May 29th a flaw in the zero-knowledge proof circuit of the Orchard shielded pool that had lain dormant for approximately four years. Theoretically, it could allow someone to create fake ZEC out of thin air without leaving on-chain traces. The team immediately initiated an emergency fix: temporarily disabling Orchard-related transactions on June 2nd, and restoring them via NU6.2 on June 3rd; concurrently, ZEC rebounded from $544 to $624. However, on June 5th, well-known investor Arthur Hayes publicly announced he had liquidated his entire ZEC position. His reason was straightforward: Even though the circuit was fixed, there is no cryptographic way to prove whether anyone had already exploited this vulnerability to secretly mint counterfeit coins in the past four years—"fixed" and "proven not to have been exploited" are two different things. Subsequently, ZEC plummeted rapidly, falling to around $309 at one point, nearly halving in value.
This precisely pierced through Zcash's foundational narrative: Its total supply is also capped at 21 million coins, consistently packaged as a "digital hard currency more thorough than Bitcoin"—but every Bitcoin issuance is on the public ledger, verifiable by anyone for total supply accuracy; Zcash, in pursuit of privacy, obscured part of this ledger. The result is that for the past four years, no one could prove whether the actual circulating supply of this "hard currency" truly remained locked within that 21 million cap.
Bull vs. Bear Collision
The bearish camp has both arguments and the conviction of real-money bets: Wang Chun believes that entering the top ten by market cap doesn't mean ZEC deserves to stand alongside Solana and Hyperliquid, and this rally is "purely driven by narrative." Garrett Jin, dubbed the "1011 insider whale agent," has demonstrated a similar stance with his positions—as of September 8th, he still holds approximately 39,760 ZEC in short positions on Hyperliquid, with a notional value of about $45 million, at an average entry price of $576.3. Despite floating losses of $22.2 million, he continues to add to his position.
The bullish camp isn't just relying on narrative either: The U.S. Securities and Exchange Commission (SEC) concluded its multi-year investigation into the Zcash Foundation in January 2026 without taking enforcement action, removing a long-standing compliance concern for institutions. Grayscale estimates that if ZEC's market capitalization reaches 2%, 5%, and 10% of Bitcoin's, the corresponding prices would be $1,622, $4,054, and $8,109 respectively. As of August 29th, ZEC's market cap was $13.74 billion, representing only 0.88% of Bitcoin's, indicating theoretical room for growth remains. The ETF uplisting and launch also allow traditional capital to gain direct exposure to ZEC for the first time without dealing with wallets or private keys.
The two sides are not arguing about the same thing: one side is calculating "how much market share can privacy assets capture," while the other is calculating "does this team and this mechanism deserve that share?"
The Score Isn't Settled Yet
From $309 all the way up to over $1,200, ZEC has undergone a round of intense repricing. But this rally hasn't changed its historical issues—the controversy over its distribution mechanism, the product paradox of optional privacy, the old news of governance infighting, and the trust gap left by the Orchard vulnerability. None of these have disappeared because of the coin's price increase, nor have any been truly resolved.
The game over what truly supports ZEC's current price isn't over yet.
The real test is not whether ZEC can hit another all-time high, but whether the market is still willing to support it at today's price after short sellers are no longer forced to cover and profit-takers start cashing out.
If it can't hold, then this surge may leave behind just another reheated old asset; if it can hold, Zcash will have truly passed this crucial round of trial.
Only then might we know whether the money flooding back in today is buying a future for a privacy asset, or just a successfully retold old story.
** The content herein is for reference only and does not constitute any investment advice. The market carries risks, and investment requires caution.
