Zcash could become a serious rival to Bitcoin among digital assets: the rapid spread of artificial intelligence increases the value of financial privacy and heightens concerns about AI-enabled surveillance, Grayscale believes.
In a new research report, Grayscale’s head of research, Zak Pandl, said that Zcash (ZEC) has “second-mover advantages” that could help it challenge Bitcoin’s (BTC) entrenched network effects. Previous alternative projects, such as Litecoin (LTC), have failed to achieve this.
Panda’s argument is based on financial privacy. Zcash can conceal transaction information, and, according to Grayscale, this feature may become increasingly valuable as AI systems improve at large-scale analysis of financial activity.
The report was published after roughly a 19-fold increase in ZEC over the past year. Despite this growth, Zcash’s market capitalization remains below 1% of Bitcoin’s—Grayscale sees this as evidence of further growth potential if Zcash can capture market share.
Panda admitted that Bitcoin’s liquidity and its established network remain a powerful safeguard for its dominant position. Grayscale also warned that Zcash is a high-risk asset, and any further growth could be volatile and uneven.
Zcash could be valued at more than $4,000 if its market capitalization reached 5% of Bitcoin’s. Source: Grayscale
The Zcash ecosystem attracts institutional capital
Interest in the Zcash ecosystem is growing amid strong fluctuations in the ZEC price. As Cointelegraph recently reported, Cypherpunk Technologies, a privacy-technology company listed on Nasdaq, increased its investment in Zcash by purchasing a mining fleet from Winklevoss Capital in a deal worth $33.33 million, paid in shares.
The mining operation is already running on facilities in the United States, providing about 4.2 GSol/s of Equihash hashrate, or roughly 18% of the total computing power of the Zcash network. Cypherpunk stated that thanks to the deal, its mining division became the largest active fleet in the network.
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