The Zcash ETF Race Gets Crowded: Winklevoss Undercuts Grayscale Tenfold as ZCSH Posts Its First Outflow Week

Winklevoss Asset Services filed a preliminary registration for a spot Zcash ETF on October 6, proposing a 0.25% annual management fee, roughly 90% below the 2.5% charged by Grayscale's ZCSH. On a $10,000 holding, the Winklevoss product would cost $25 a year versus $250 for ZCSH, according to BeInCrypto. The fund, which would trade under the ticker WINK on Nasdaq, would hold ZEC directly, with Gemini Trust, the crypto custodian founded by Cameron and Tyler Winklevoss, as custodian. The filing describes Gemini as an affiliate of the sponsor and lists that relationship as a conflict of interest.

The filing also indicates that Winklevoss Capital Fund has expressed interest in purchasing up to $100 million of shares, though the filing states that the interest is not binding. The sponsor was formed on October 1 and, according to the document, has no prior experience operating a pooled investment fund. The registration remains preliminary: WINK cannot trade until the SEC declares it effective, Nasdaq must separately approve the listing, and the price benchmark, seed amount and trading partners are still unspecified.

Grayscale's ZCSH, the only Zcash ETF currently holding the token, has experienced notable redemptions. Per BeInCrypto and SoSoValue data, the fund held roughly $1 billion on September 24 and about $782 million by October 5, with withdrawals accounting for roughly $97 million of the decline and the remainder attributable to ZEC's price decline. Cumulative net inflows fell from about $306 million to $209 million over the same period. Reports indicate October outflows of approximately $59 million, and BeInCrypto reported that the fund posted its first weekly outflow since launch, at about $93.6 million.

Zcash, a privacy-focused cryptocurrency that allows users to conceal the sender and amount of a payment, has risen sharply over the past year, reportedly around 700%, which has drawn additional issuers into the market. The competitive dynamic between a 0.25% fee product and an incumbent with a 2.5% fee is likely to be a central question for allocators evaluating the category, although the Winklevoss fund's approval timeline and operational details remain unresolved.