Is Zcash the Swiss Bank Account of Cryptos?

In a market with over 1,500 cryptocurrencies, investors are always on the prowl for the next breakout asset. According to asset manager Grayscale Investments, Zcash (ZEC) could be poised for exponential gains over the next seven years.

$60,000 Zcash?

Zcash, the privacy-focused cryptocurrency, could reach $60,000 in 2025, based on a financial model put together by Grayscale researcher Matthew Beck. With Zcash currently trading at around $408, that represents a 150-fold increase in price. Although gains of this magnitude aren’t unheard of in cryptocurrency, Beck’s time horizon suggests we are in the midst of a bull market that still has many years left to go.

However, the financial model has one huge caveat: it assumes that Zcash will represent 10% of offshore wealth by 2025. Although this sounds absurd given the current market landscape, Beck argues that the coin’s potential extends far beyond its existing utility.

Like bitcoin and Ethereum before it, Zcash has been lauded for its safe haven properties. Combined with its privacy features, it could become the haven of choice for investors looking to hedge against inflation and political risks.

Beck argues:

“[T]he privacy-enhanced features that ZEC offers perhaps make it even more resilient as a store-of-value than BTC, since selective disclosure reduces susceptibility to government intervention. We think of ZEC as the first globally accessible “offshore” investment opportunity, or a Swiss bank account in your pocket, so to speak.”

To arrive at levels anywhere near where Grayscale has forecast, Zcash will have to contend with a myriad of market forces, which include regulation and mainstream adoption. Interestingly, Grayscale has been supporting the adoption of Zcash since the fall when it first added the coin to its portfolio.

Enhanced Privacy Features

Regardless of whether Zcash hits $60,000 or not, the coin’s privacy features have drawn the attention of security experts, whistleblowers and even cyber criminals. The cryptocurrency employs zero-knowledge proofs and enhanced encryption techniques that obscure the sender’s address. This feature goes above and beyond other privacy coins, such as Monero, which may generate fake addresses to hide the original sender’s true identity.

There are already signs that the criminal underworld is beginning to catch on to ZEC and other privacy-focused coins to evade law enforcement. Currencies such as ZEC and Monero are said to go above and beyond the privacy currently offered by bitcoin and other leading altcoins.

ZEC Price Levels

The value of Zcash rose 3% to $405 on Thursday for a total market cap of $1.3 billion. The cryptocurrency is on track for a large weekly decline, having lost nearly 15% over the past five sessions. ZEC is currently trading at around half of its historic high, which was obtained earlier this month.

Daily turnover in ZEC averaged $76.5 million on Thursday, according to CoinMarketCap. Crypto exchanges HitBTC and Huobi each processed roughly one-fifth of the daily transactions. Bitfinex, Binance and Bitrex were also active markets for holders of ZEC.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock. 

Chief Editor to and Contributor to, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi