Grayscale's Zcash (ZEC) ETF Sheds $93.6 Million in First Weekly Outflow

First Outflow Week for Grayscale's ZCSH

$93.6 million left the Grayscale Zcash (ZEC) ETF in the week that ended on Friday, October 2, the fund's first week of net outflows since its August launch. Grayscale's ZCSH vehicle took in new money on a daily net basis only through September 22; the daily flow tape shows not a single day of net inflows since that date. The Zcash price traded near $1,308 as of 13:45 UTC on Saturday, October 3, down 6.7% over the past 24 hours. The token has shed about 17.5% since the week opened and sits roughly 23% below its recent peak near $1,690. Redemption pressure does not account for the whole drop, but the direction is unambiguous: investors have declined to buy the dip through the fund, and another stretch of redemptions would extend that pressure into mid-October. Net flow, the weekly difference between share creations and redemptions, turned negative for the first time in the product's short life, so the August cohort of buyers has begun to unwind at a mark near $1,300. Redemptions do not mechanically force token sales, since in-kind structures move shares rather than coins, but they thin the demand base under a market already in retreat across the broader altcoin market. Weekend trading has been calm by comparison: the live spot sits about 0.4% below the level recorded when the weekly print was published at 12:28 UTC on Saturday, with no renewed selling wave since. No fresh weekly figure has been published for the session still in progress. Fund flow records are the cleanest public gauge of institutional demand for ZEC, and they now point down. A second consecutive week of outflows would move the vehicle from the sector's fastest-growing product to a net seller's ledger within a quarter of listing.

From $98.2 Million Lead to Reversal

Two weeks before the flip, the ZCSH fund drew $98.2 million in weekly inflows and ranked first among all crypto ETFs, an unusual position for a product in its first month. The ledger then turned: the fund posted a $30.25 million single-day net outflow on September 30, and the weekly total crossed into negative territory for the period that closed on October 2. Measured across the two prints, the flow balance swung by $191.8 million in fourteen days. No day has closed with positive net flow since September 22, which leaves the fund without a fresh-subscription session in the entire review period. On-chain activity points the other way. A whale address executed a 2,000 ZEC withdrawal from Binance into a self-custody wallet holding $66.19 million during the pullback, a pattern consistent with accumulation rather than distribution. Large withdrawals from centralized venues reduce coins available for immediate sale, a cushion the fund side does not provide. Grayscale has kept building the product line while the flagship fund bleeds. The firm filed for a Zcash High Income ETF, a proposed vehicle with biweekly payouts that now sits in a 75-day SEC review window, and the filing remains pending as of this week. Approval timing is not disclosed in the review schedule, and no decision date has been set. Flows, not price alone, now set the near-term tone for ZEC: until ZCSH prints a daily net inflow for the first time in eight trading sessions, the demand base that carried the token to $1,690 stays in retreat.

$1,103 Support Sets the Line

A separate review of the flow tape adds a slightly sharper picture of how the reversal built. The weekly net outflow is now put at $93.56 million, and the ledger shows the pressure began before the late-September spike: a $8.12 million daily outflow printed on September 28, followed immediately by the larger $30.25 million exit two days later. The updated peak reading stands at $1,698, with the pullback measuring about 21% to a floor near $1,333. Grayscale, for its part, has not joined the bearish read: a recent report from the firm reaffirmed its view that ZEC's value appreciation cycle is not over, arguing that a recovery through $1,425 and then $1,494 resistance could carry the token back toward the high $1,600s. Analysts cited in the same coverage flag $1,400 as the first decision level on any rebound, with $1,300 the line of defense and $1,296 the trigger below which a slide toward $1,254 opens.

Primary filings and fund records add structural detail to the outflow picture. Cumulative net inflows into ZCSH remain positive at roughly $212.56 million, even as total net assets slipped to about $751 million after the redemptions, which included a $26.93 million exit on October 2 alone. Grayscale also completed a three-for-one forward share split on September 30, the same session as the largest daily outflow: a filing shows shares outstanding rising from 7,989,300 to 23,967,900 while net asset value per share fell from $111.41 to $37.14, leaving holder value unchanged. Separately, a filing records that Digital Currency Group bought roughly $100 million of ZCSH shares on September 8 through an authorized participant, in exchange for 85,705.33 ZEC, with the shares carrying no special preference features.

Network development offers a counterpoint to the fund outflows. The Zcash Foundation released Zebra 7.0.0-rc.0 on October 2, the first release candidate for Network Upgrade 7, with the public testnet activation scheduled for October 6 at block 4,465,026. NU7's headline change cuts the target block time from about 75 seconds to 25 seconds, roughly tripling the speed of first transaction confirmations, and the upgrade also adds a Network Sustainability Mechanism that redirects part of transaction fees to future block rewards, plus new limits on spam through shielded transactions. A final mainnet decision is set for October 20, with activation targeted for November 5 if conditions hold. Derivatives data shows leverage also unwinding: futures open interest fell about $134 million over two days to roughly $2.65 billion, alongside some $21.1 million in liquidations.

Aggregate flow data tracked by Sosovalue sharpens the picture of how the ZCSH reversal unfolded day by day. Redemptions ran $8.12 million on September 28, $30.25 million on September 30, roughly $28.26 million on October 1 and $26.93 million on October 2, while assets under management slid from a September peak near $979 million to about $751 million. The source also flags a detail that trims the fund's headline growth: the roughly $100 million September 8 subscription from Digital Currency Group came via an in-kind swap of 85,705.32563297 ZEC, meaning outside investors contributed less than the raw total suggests. On the ledger's other side, net positions have stayed positive since August 25, with protected holdings above 4.89 million ZEC, and futures open interest has fallen from a September high above $3.4 billion to about $2.5 billion, with 24-hour liquidations down to roughly $1.03 million as of October 4.

COINOTAG's proprietary 42-indicator composite support and resistance scoring engine rates the $1,383.9952 resistance at 90/100 on R3, Fibo 0.236, Ichimoku Kijun and LVN, with $1,546.3834 next at 57/100 on Fibo 0.114, ATR Upper and Ichimoku Tenkan. The strongest stand on the ZEC technical analysis map sits at $1,229.0033, scored 73/100 on ATR Lower, Supertrend, Fibo 0.382 and S3. Spot trades at $1,346.5200, up 2.72% on the day, with RSI at 51.08, a bearish MACD and an uptrend label still standing. Positioning across contract trading is mildly positive: perpetual futures funding prints 0.0055% against $850.7 million in open interest. The bullish case holds while $1,229.0033 stands; a daily close below it exposes $1,041.7000 (73/100) and then $876.0785, where the HVN, SMA 100 and Fibo 0.618 score 54/100. The Fear and Greed Index reads 65 of 100, a greed reading.