Zcash Foundation Cleared: SEC Concludes Long Investigation Without Any Action

The Zcash Foundation has announced that the U.S. Securities and Exchange Commission (SEC) has concluded a lengthy investigation without taking any enforcement action. This outcome offers greater regulatory clarity for Zcash, a prominent privacy-focused cryptocurrency, as the market experiences volatility.

Key Takeaways

The SEC investigation into the Zcash Foundation ended without any enforcement actions.
The inquiry, which started in August 2023, assessed whether certain digital assets qualified as securities.
Zcash’s unique privacy model, which uses zero-knowledge proofs, remains a focal point in discussions about financial privacy and regulation.
Market activity for Zcash (ZEC) has increased, with the token's trading volume rising significantly.

Zcash Foundation Cleared: SEC Concludes Long Investigation Without Any Action

SEC Inquiry Concludes, Bringing Clarity to Zcash

This week, the Zcash Foundation revealed that the SEC's extensive investigation has come to a close without any enforcement actions. This brings much-needed regulatory clarity to one of the most observed projects in the cryptocurrency space, especially as Zcash has faced increased market fluctuation recently.

In a statement posted on Wednesday, the foundation stated that the SEC has "concluded its review” related to “certain crypto asset offerings.”

The investigation began back in August 2023 when the foundation received a subpoena due to the SEC’s broader effort to assess whether certain digital assets complied with federal securities laws. This case, internally labeled SF-04569, remained active for over two years.

Zcash Price Update

Zcash’s Privacy Model Under Review

The foundation noted that the investigative outcome demonstrates its continued cooperation and commitment to adhering to existing regulatory frameworks. They also emphasized that their mission focuses on enhancing privacy-preserving financial infrastructure. Although the SEC did not release an official public statement, the foundation indicated receipt of confirmation about the closure of the review.

The favorable decision comes at a time when Zcash is seeing renewed interest in the market. ZEC is currently trading around $439, reflecting a nearly 13% increase in recent trading activity, with its 24-hour trading volume climbing over 30% to approximately $881 million.

Despite recent gains, Zcash's value remains significantly lower than its historical peak, trading over 86% down from its all-time high of $3,191, recorded during the bull market of 2017.

The issue of regulatory oversight concerning privacy-focused cryptocurrencies has been a constant topic of discussion. These initiatives utilize cryptographic techniques to protect transaction details while still functioning within public blockchains.

Zcash, launched in 2016, incorporates zero-knowledge proofs, allowing users to conduct shielded transactions without revealing the sender, receiver, or amount transferred. This unique design has placed Zcash at the center of critical conversations about financial surveillance, compliance, and the limits of on-chain privacy.

Changing Landscape of U.S. Crypto Regulation

The SEC’s examination of the Zcash Foundation took place alongside other inquiries in the cryptocurrency landscape. Previously, the agency reached out to Grayscale Investments to assess if ZEC could be categorized as a security related to its Zcash Trust. Furthermore, SEC officials have had direct interactions with Zcash’s founder, Zooko Wilcox, which included discussions on privacy technologies and regulatory supervision.

The termination of the investigation aligns with a wider shift in how U.S. regulatory bodies are handling cryptocurrency enforcement, particularly since 2025. With Paul Atkins appointed as the new SEC chair, numerous high-profile cases initiated under the previous administration have either been resolved or dropped.

Notably, lawsuits against notable exchanges such as Coinbase and Kraken concluded with no penalties, while investigations into Robinhood’s crypto unit, Uniswap Labs, OpenSea, and Gemini also wrapped up without charges. Although the SEC continues to pursue fraud-related cases, there appears to be a trend moving away from aggressive enforcement actions focused solely on token classification.

The conclusion of the SEC's Zcash inquiry occurs during a turbulent time internally for the project, as governance disputes between the Electric Coin Company and the nonprofit Bootstrap recently escalated into a public divide, resulting in core developers forming an independent new entity. Despite this, operations within the Zcash network have remained unaffected, and project leaders have assured that security and privacy measures are still intact.