Zcash (ZEC) is currently under increasing downward pressure, as both technical patterns and blockchain data indicate a possible revisit of important support zones. The digital asset
climbed to a recent peak of $601
after OKX revealed plans to relist
ZEC
, briefly sparking renewed enthusiasm for the privacy-oriented coin. Yet, this upward movement was short, with prices slipping back to $564 amid overall market softness and a lack of persistent adoption signals. Market observers are now debating whether the latest surge is fueled by authentic buying or speculative trades, as blockchain metrics and large holder activity provide conflicting evidence.
A significant bearish factor is the activity of a well-known short-seller known as the "Cool-headed Whale," who
trimmed their ZEC short by 2.6 million tokens
on November 23. Despite reducing this position, the whale still holds a large overall short, with unrealized losses totaling $4.05 million across several assets. The ZEC short alone has a liquidation threshold at $684.55, indicating more downside risk if the price drops below crucial levels. This fits with the broader trend, where ZEC's price gains have outstripped its underlying fundamentals. For example, although ZEC has jumped more than 1,100% in the past quarter,
blockchain statistics show most activity is within shielded pools
, making it hard to track user growth and transaction counts. This lack of transparency casts doubt on the rally's durability, as visible network usage—such as transparent transactions—has not kept pace with price increases.
The privacy features of
Zcash
make standard adoption analysis challenging. Unlike Monero, which offers complete transaction privacy but still allows for some protocol-level tracking, Zcash's hybrid approach
complicates efforts to measure actual demand
. Recent surges in visible transaction volume, such as the Zerdinals inscription event that pushed daily transactions past 70,000, seem to be driven by specialized use cases rather than widespread adoption. At the same time, the movement of ZEC into shielded pools—now exceeding 4 million tokens—has tightened supply and increased price swings. With about 30% of ZEC's circulating coins held in shielded addresses, traders are paying extra for liquidity, a situation that could reverse if sentiment changes.
Technical signals also indicate a possible pullback. On the weekly chart, Zcash is forming a double-top near its yearly high, while the RSI stays bullish but is lagging behind the MACD, which
points to fading momentum
. The wider crypto market, including Ethereum's difficulty in surpassing $3,000
amid ongoing market stress
, adds to the challenges. Should ZEC fail to move back above the $684.55 liquidation mark, it could trigger a wave of short covering and further declines. Some analysts, such as Ali Martinez, have set optimistic targets (like $750), but these depend on renewed institutional interest and stable macroeconomic conditions—both of which are currently uncertain.
To sum up, Zcash's short-term prospects remain uncertain. While the OKX relisting has improved liquidity, weak on-chain adoption and bearish whale positioning suggest a likely test of major support levels. Traders should keep an eye on the $564–$500 range, as a break below this could speed up a drop toward $400. At present, the market seems to be reacting more to supply constraints than to any fundamental increase in demand, leaving ZEC exposed to broader market downturns.
