In a Sept. 25 filing with the SEC, Grayscale proposed the ZCSH High Income ETF, an actively managed fund designed to generate income through options tied to Zcash exchange-traded products. The fund would target biweekly distributions while maintaining indirect exposure to ZEC.
The timing is notable. Grayscales existing Zcash ETF, ZCSH, has grown to roughly $996 million in assets, while ZEC itself has surged sharply during September.
The New ETF Would Not Hold ZEC Directly
This is not another spot Zcash ETF.
The SEC filing says the new fund would not hold ZEC, maintain a crypto wallet or control private keys. Instead, it would use options tied to Zcash ETPs, including the existing ZCSH fund.
The strategy resembles a covered-call product. The fund would collect option premiums and use them to support distributions every two weeks.
That income comes with a trade-off: selling calls can limit upside if Zcash rallies sharply above the options strike prices.
ZCSH Is Already Approaching $1 Billion
The filing arrives as demand for regulated Zcash exposure accelerates.
ZCSH crossed $500 million in assets just weeks after launch, and by Sept. 25 its asset base was approaching $1 billion.
Importantly, that does not mean investors added nearly $1 billion of fresh cash. Part of the total reflects ZEC already held by the former Grayscale trust, while the sharp rise in Zcash‘s price has also boosted the value of the fund’s assets.
The conversion of Grayscale‘s Zcash trust into ZCSH gave U.S. investors an easier brokerage route into ZEC, while Zcash’s rally above $1,200 helped bring more attention to the privacy coin.
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A separate European Zcash ETP has also broadened institutional access.