Galaxy Identifies Zcash as a Bitcoin Alternative

ZEC could become the "spiritual successor" to Bitcoin, says Galaxy Digital analyst.

Zcash (ZEC) could emerge as the “spiritual successor” to the first cryptocurrency amid the convergence of the digital asset market and traditional finance, stated Galaxy Digital analyst Will Owens.

In his view, the coin is already an alternative to digital gold.

Owens pointed to the growing popularity of ZEC among those concerned about Bitcoin’s centralization due to Wall Street and worried about on-chain transaction tracking. Zcash allows for “shielded” transfers using zero-knowledge proofs, ensuring anonymity.

Proponents of the anonymous coin refer to it as “encrypted Bitcoin” and a return to cypherpunk principles. According to Owens, this contrasts with the situation surrounding Bitcoin, where ETFs strengthen the role of centralized custodians. Meanwhile, U.S. regulators are increasing pressure on mixers like Samourai.

The Galaxy analyst noted that Zcash’s fundamentals remain unchanged, yet the perception of the technology has evolved. Network privacy is growing with the increase in shielded transaction users. The larger the pool, the harder it is to trace fund flows. Currently, about 30% of Zcash’s supply is in it.

According to CoinGecko, ZEC is the largest privacy asset by market capitalization, valued at $7.4 billion. Its closest competitor is Monero (XMR) at $6.7 billion.

Capital Rotation

XMR is defying the overall downward trend, showing positive dynamics. On November 5, XMR reached an intraday high of $377. Over the past 24 hours, the asset rose by 7.8%, and by 11% over the month.

Experts linked the developments to the growing demand for financial anonymity. TYMIO founder Georgy Verbitsky stated that privacy has become one of the main narratives in the crypto industry. Reasons include tightening global regulations and future requirements for exchanges to report wallets to tax authorities.

CEO of AMLBot Slava Demchuk believes that increased oversight of major blockchains is pushing users towards alternatives. According to Presto Research head Peter Chang, the emergence of “pockets of strength” in specific niches, driven by retail interest, is a feature of the current market cycle.

In November, Zcash developers unveiled their roadmap for the fourth quarter.