Grayscale updates Zcash ETF filing as DCG unit weighs $110M ZEC buy

Grayscale has filed its fourth amendment to convert the Zcash Trust into an exchange-traded fund while disclosing that a Digital Currency Group subsidiary is considering an investment representing about 200,000 ZEC, currently worth roughly $110 million. Summary Grayscale filed its fourth amendment to convert the Zcash Trust into an ETF listed on NYSE Arca. A DCG subsidiary is considering an investment representing about 200,000 ZEC, worth roughly $110 million. The discussions are nonbinding and the investor could ultimately purchase more, fewer or no shares. The filing also addresses the Orchard vulnerability and the Ironwood upgrade that followed. According to an Aug. 18 registration statement filed with the U.S. Securities and Exchange Commission, Grayscale plans to list shares of the converted trust on NYSE Arca under the existing ZCSH ticker, subject to the registration becoming effective. The latest amendment also identifies DCG International Investments Ltd., a subsidiary of Grayscale parent Digital Currency Group, as a potential investor. The company is discussing a purchase of shares representing exposure to approximately 200,000 ZEC. With Zcash trading near $555, the proposed amount would be valued at roughly $111 million. Grayscale stressed that no binding purchase agreement has been reached and that the eventual transaction, if one takes place, could differ substantially from the amount under discussion. “However, because these discussions are not binding agreements or commitments to purchase, the Potential Investor could determine to purchase more, fewer or no Shares,” the filing said. Grayscale Zcash ETF would convert an existing investment product The amendment moves forward a conversion process built around Grayscale’s existing Zcash investment vehicle, which has provided investors with ZEC exposure without requiring them to hold the cryptocurrency directly. Grayscale filed for the conversion in May, proposing to move ZCSH from its existing over-the-counter structure to NYSE Arca. The trust would continue holding ZEC while its publicly traded shares would provide investors with exposure to the value of the underlying cryptocurrency. A subsequent crypto.news review of the filing found that the trust held 391,103.89 ZEC worth about $99.4 million as of March 31. Coinbase Custody was listed as custodian, BNY Mellon as administrator and the CoinDesk Zcash Price Index as the pricing benchmark. The latest SEC filing shows that the trust’s principal market net asset value had increased to about $155.25 million as of June 30, with a principal market NAV per share of $32.15. Under the proposed ETF structure, authorized participants would be able to purchase and redeem shares in blocks of 10,000 shares, which Grayscale defines as baskets. The trust intends to issue shares continuously once the registration becomes effective and the NYSE Arca listing is completed.