Grayscale’s Zcash exchange-traded fund (ETF) attracted $41.1 million in new investments last week, marking the fund’s strongest weekly inflow since September. The reversal in flows coincided with Zcash’s ZEC token rising 6.98% over seven days, while Bitcoin and Ethereum both saw price declines.
Zcash ETF inflows break recent outflow pattern
The Zcash ETF had previously experienced three consecutive weeks of outflows totaling $143.4 million. Last week began with further withdrawals of $10.4 million on Monday. However, the trend shifted as the fund registered positive inflows over the next four sessions, culminating in a $20.5 million intake on Friday. This single-day figure represented nearly half of the week’s net inflows.
As a result, the Zcash ETF recovered about 29% of the prior three-week outflows, though $102.3 million in redemptions remain unrecovered. Despite the rebound, analysts regarded the change as notable but cautioned against drawing conclusions from a single week.
Last week’s $41.1 million inflow into Grayscale’s Zcash ETF marked a sharp break from the previous three-week outflow streak, bringing renewed attention to ZEC amid market-wide losses for Bitcoin and Ethereum.
Meanwhile, Bitcoin ETFs faced over $500 million in outflows during two sessions but ended the week with $301.2 million in net inflows thanks to earlier demand. Ethereum ETFs, on the other hand, reported $220.7 million in weekly withdrawals. Zcash’s ETF inflow pattern stood out due to its divergence from the broader market’s direction.
Investor motives for entering the Zcash ETF remain unclear, as one week of inflows does not establish a sustained trend or a definitive explanation, such as demand for private transactions.
| ETF | Weekly Inflows/Outflows |
|---|---|
| Zcash | $41.1 million inflow |
| Bitcoin | $301.2 million net inflow |
| Ethereum | $220.7 million outflow |
ZEC price action and technical outlook
Alongside the renewed fund inflows, ZEC rebounded from a low of $1,118 last week and approached technical resistance at $1,200. Analysts have pointed to $1,223 as a critical short-term target, with possible technical crossovers projected around October 28. However, these signals do not confirm a lasting upward trend, and the recent 6.98% weekly gain remains modest compared to past price volatility.
Chart analysts noted that while a close above $1,223 could trigger a bullish signal, ZEC still faces risk if it fails to hold that level. Whale Factor, a market analytics platform, identified $597 as a significant historical price marker despite its distance from current trading levels. This underscores the fact that different time frames and technical perspectives suggest both upside and downside scenarios for ZEC.
Mini dictionary: Whale Factor, a market analytics service, provides technical analysis, on-chain metrics, and price trendidentification across digital assets, focusing on large-scale trading patterns.
Closing above the $1,223 level remains a focus for bullish traders, yet technical analysts emphasize that the overall setup continues to present downside risk within a broader declining channel.
Upcoming NU7 upgrade and macro events
The Zcash protocol’s upcoming NU7 upgrade has also drawn attention. The critical decision on activation height took place on October 20, with mainnet activation set for November 5. The upgrade will reduce block spacing from 75 seconds to 25 and introduce the Network Sustainability Mechanism, which aims to enhance long-term network security. As part of this update, version 4 transactions will become invalid, while versions 5 and 6 will remain supported.
Mini dictionary: NU7 is an upcoming major upgrade for the Zcash network. It focuses on reducing transaction latency and implementing mechanisms to secure and sustain the network over the long term, with impacts on block times and infrastructure requirements for full nodes and indexers.
Elsewhere, market participants are keeping an eye on the upcoming Federal Reserve policy meeting scheduled for October 27–28, which is expected to influence broader risk sentiment and could affect inflows to crypto ETFs, including Zcash, in the coming week.
