Zcash (ZEC) surged to the forefront of the cryptocurrency derivatives market after a sharp 15% rally pushed its price to approximately $1,170. The rapid advance on September 6 was accompanied by around $212 million in total crypto market liquidations, with ZEC accounting for $45.32 million of that figure—the highest among major tokens during the session.
Liquidation wave hits bearish traders
Liquidation data showed that short positions represented roughly $156 million of the $212 million in closed trades, highlighting the scale of losses faced by bearish traders on the day. Leveraged positions betting against rising prices lost margin support as ZEC and other coins shot higher, forcing exchanges to close out positions at market prices and amplifying upward pressure.
ZEC’s liquidations surpassed those of Ethereum, which posted $35.16 million in forced closures. Bitcoin followed with $16.79 million, while Arbitrum saw $12.93 million liquidated. With over one-fifth of all liquidations, ZEC stood out as the dominant driver of the day’s action.
ZEC recorded $45.32 million in liquidations, topping all major tokens as short sellers absorbed most of the losses during the price surge.
Data indicated that nearly three-quarters of all liquidations came from short sellers, confirming a strong short squeeze. The trend reflected a heavy concentration of bearish bets right before ZEC’s price breakout.
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AAPLOpen interest and technical metrics hit records
ZEC’s derivatives market activity had already intensified prior to the rally. Open interest in perpetual futures for ZEC reached an all-time high of about $2.4 billion on September 4, compared to roughly $700 million in early July. This surge in leveraged exposure coincided with the upswing in ZEC’s price trajectory.
The token traded above $1,000 for the first time since its early days after launch, and its market capitalization briefly approached $19.8 billion at the peak. At the same time, technical indicators pointed to a rapid ascent, with the 14-day relative strength index soaring above 82 and the price exceeding 2.5 times its 200-day moving average of $449.40.
| Token | Liquidations | Recent Price | Open Interest |
|---|---|---|---|
| Zcash (ZEC) | $45.32 million | $1,170 | $2.4 billion |
| Ethereum (ETH) | $35.16 million | – | – |
| Bitcoin (BTC) | $16.79 million | – | – |
| Arbitrum | $12.93 million | – | – |
ETF inflows and network milestones fuel momentum
On the spot market, ZEC also benefited from institutional demand following the recent conversion of Grayscale’s long-standing Zcash Trust into an exchange-traded fund (ETF), ZCSH. Grayscale, a major digital asset manager, registered shares of ZCSH for trading on NYSE Arca after the conversion on August 24, with the new ETF debuting the next day.
The ZCSH ETF saw at least $34.4 million in net inflows by early September, providing traditional investors with exposure to Zcash without direct crypto custody. This development added a new source of demand beyond derivatives.
Regulatory and development milestones further supported ZEC’s momentum. In January, the Zcash Foundation announced that the US Securities and Exchange Commission had ended its 2023 subpoena investigation of the project, with no enforcement action recommended.
The Zcash network completed its Ironwood NU6.3 upgrade on July 28. The update included the launch of a new shielded pool after a previous vulnerability was discovered in the Orchard protocol, and introduced an independent method for verifying the circulating supply.
Mini dictionary: Zcash Foundation, a nonprofit entity supporting the Zcash network, focuses on research, development, and governance for privacy-focused blockchain infrastructure.
Despite the rally, ZEC remained below CoinGecko’s all-time high of $3,191.93. The immediate outlook for the token is still shaped by high leveraged markets, significant ETF inflows, and ongoing network upgrades.
