ZEC and the future of privacy coins: ETFs, partnerships, and adoption

Despite all the macro FUD, 2025 still rewarded chains and sectors that have evolved a lot over the past few years, whether its Real-World Assets (RWA) growth, utility-driven projects, or the NFT marketplace.That said, one big shift happened this year: Demand for private transactions really took off. Privacy blockchains have been around for a while, but in 2025, investors’ interest in them finally went mainstream.The result? An institutional boost, effectively “legitimizing” the sector.ZEC’s Q4 rally sparks a privacy coin comebackNothing shows the surge in privacy better than their YTD performance.Monero [XMR] and Zcash [ZEC], the top two privacy tokens, are heading into the final month of the year with triple-digit gains, standing out while most other assets stay deep in the red.In fact, together, they now make up about 25% of the $60 billion privacy market, highlighting their influence. The real fireworks, however, came in Q4, when ZEC surged 500%, far outpacing XMR’s 41% gain.Source: TradingView (ZEC/USDT)That said, the road ahead isn’t exactly smooth.Currently, ZEC is down 40% after four straight green weeks. Meanwhile, critics were quick to call its Q4 rally “artificial,” and economists have warned investors not to get caught up in “coordinated token pumps.”Against this backdrop, Grayscale’s SEC filing for the first-ever U.S. spot ZEC ETF might look too risky. However, could it instead be the first sign of where the privacy coin sector is now and where it’s headed?Privacy coins get their first institutional boostThe reward for ZEC’s explosive rally came from Grayscale’s recent filing.For context, Grayscale has submitted an S‑3 registration with the SEC to convert its existing 394,400‑coin Zcash Trust into the first U.S. spot ETF tracking ZEC, set to trade on NYSE Arca under the ticker “ZCSH.”This is the first time a privacy token has received such an institutional boost. To put it in perspective, it puts Zcash on par with other real-use digital assets, the difference being that it brings privacy to the mainstream.Source: XOn the macro side, the filing comes despite ZEC’s selling pressure.Why does it matter? While the market has worried about exit liquidity, and price swings, Grayscale’s filing, along with the recent ZEC DAT from the Reliance Group, shows a clear long-term commitment to the token.In this context, the move could mark a turning point for privacy coins, as the market starts looking beyond short-term volatility. The question is: What’s next for Zcash’s roadmap, the one institutions are betting on?ZEC moves beyond speculation into practical applicationsIn 2025, Zcash gained important real‑world backing.For instance, Reliance Global Group significantly increased its ZEC holdings, naming ZEC as its primary digital‑asset exposure in its Digital Asset Treasury (DAT), signaling confidence in its long-term potential.Meanwhile, Electric Coin Company (ECC) advanced Zcash’s core tech, releasing upgrades to improve privacy. Together, these moves strengthened ZEC’s credibility among both institutional and retail users.Source: XTake the recent UXLINK–ZEC partnership, for example.UXLINK is a Web3 platform that provides businesses and developers with tools to build decentralized applications and blockchain-based services. The partnership brings Zcash’s privacy features into this infrastructure.In turn, this opens the door for real-use cases for ZEC, highlighting the direction privacy coins are heading to. Against this backdrop, Grayscale’s listing could be just the beginning of deeper adoption for privacy coins.Final ThoughtsZEC and other privacy coins are moving beyond speculation, with institutional backing and real-world use cases driving adoption. Grayscale’s first-ever U.S. spot ZEC ETF signals growing mainstream acceptance and legitimizes the privacy-coin sector.