Zcash: The Most Underestimated Asset in Crypto, According to Cypherpunk CIO

Cypherpunk Technologies' Chief Investment Officer, Will McEvoy, argues that Zcash (ZEC) is significantly undervalued. He explains that the market lacks a proper mechanism to value privacy, especially as the need for financial confidentiality grows amid increased surveillance. McEvoy provides compelling arguments and benchmarks to suggest that Zcash has substantial growth potential.

Key Takeaways

Underestimated Privacy Asset: Zcash (ZEC) is mispriced due to the market’s inability to value privacy accurately.
Comparative Market Analysis: McEvoy compares Zcash's current market cap against Bitcoin, gold, offshore assets, and stablecoins to highlight its potential.
Valuation Scenarios: Different price scenarios suggest Zcash's value could rise significantly based on market capture from various asset classes.
Contrast with AI Surveillance: McEvoy describes Zcash as a countermeasure to increased AI-driven surveillance, making privacy more valuable.

Zcash: The Most Underestimated Asset in Crypto

Understanding Zcash's Mispricing

Will McEvoy, the CIO of Cypherpunk Technologies, has made a strong case regarding Zcash, indicating that it is undervalued in the cryptocurrency market. He points out that the current investment landscape fails to adequately price privacy, particularly as the use of AI for surveillance expands, leading to growing demand for confidential financial transactions.

McEvoy’s Central Argument
He asserts, “Zcash is the most mispriced asset in crypto because privacy is the most mispriced asset in society.” McEvoy emphasizes the need for a proper valuation framework for privacy, which is often overlooked despite its significant upside potential.

Reasons Zcash Might Be Underestimated

In his argument, McEvoy focuses on market scale. At the time of his analysis, ZEC was priced at $263, with a market capitalization of $4.4 billion. In comparison, he lists Bitcoin at $1.45 trillion, gold at $34.8 trillion, offshore wealth at $11.3 trillion, and stablecoins at $312 billion, alongside Monero at $6.8 billion. His point underscores that Zcash remains a minor player in any market it could potentially engage with.

Valuation Potential
Referring to Bitcoin, McEvoy shows that Zcash is so small that even a slight shift in its recognition could result in significant price increases. For example, if ZEC reached 0.5% of Bitcoin’s value, its price could potentially rise to $446, and even higher at 1% ($891) or 2% ($1,782). He tersely concludes, “Zcash is encrypted Bitcoin.”

Privacy's Historical Value

McEvoy points to the substantial $11.3 trillion in offshore wealth as a clear indicator of the premium people are willing to pay for privacy. He states, “People pay a premium for privacy. They always have. They always will.” If Zcash were to tap into just 0.1% of that market, its price could soar to $680; 0.5% would yield $3,402, and 1% could mean $6,804. He adds, “Zcash is a Swiss bank account in your pocket.”

Comparing Zcash with Traditional Assets

He also extends his argument to gold, highlighting its privacy features. McEvoy notes, “Gold is private. You can hold it. No one knows how much you have,” drawing parallels with Zcash, which is digital, portable, and programmable. Consequently, he predicts possible ZEC prices as follows: $1,048 at 0.05% of gold’s value, $2,095 at 0.1%, and $10,477 at 0.5%.

Additionally, he contends that Zcash serves as a response to the visibility inherent in many existing cryptocurrencies. Stressing the privacy aspect, he discusses how ZEC may reach 5%, 10%, or even 25% of the stablecoin market, suggesting price points of $939, $1,877, and $4,692.

Zcash vs. Monero: Who Will Claim the Throne?

When contrasting Zcash with Monero, McEvoy claims Zcash has “stronger cryptography, optional transparency for compliance, and better scalability.” He presents projected ZEC values based on its potential relative to Monero, suggesting valuations of $410 for parity, $819 if double Monero, and $2,047 if five times Monero’s value. He asserts, “The privacy coin throne is not yet claimed.”

Final Thoughts: A Shifting Technological Landscape

Drawing a broader connection, McEvoy links his thesis to an ongoing technological evolution. He states, “Artificial intelligence is the attack. Zcash is the defense.” As AI continues to decode vast amounts of data, Zcash plays a critical role as a protector of individual privacy. McEvoy’s perspective posits that as AI technologies advance, the value of privacy will only increase.

At the time of publication, ZEC was trading at $244.77.

Zcash price chart
ZEC hit resistance at the 20-week EMA and the 0.786 Fibonacci level, as seen in the one-week chart.