XRP is valued at nearly 6% of bitcoin's market capitalization, providing a reference point for how other digital currencies may grow, according to Grayscale Investments. Zcash, which accounts for approximately 1.5% of bitcoin's value, has risen from less than 0.1% a year earlier, with Grayscale arguing the token has not reached a valuation ceiling.
Ten Tokens in Bitcoin's Currency Sector
Grayscale identifies 10 qualifying tokens alongside bitcoin in its Currencies Crypto Sector, including XRP, Zcash (ZEC), and Litecoin (LTC). The category encompasses digital currencies focused on transferring value, storing value, and expressing prices in a common unit, spanning standard monetary protocols and cryptocurrencies with privacy features.
Zach Pandl, head of research at Grayscale, outlined this classification in a September 29 analysis. FTSE Russell and Grayscale review sector classifications quarterly, allowing for changes as the market develops.
Historical Context for Zcash Valuation
During the 2017-18 market cycle, XRP, bitcoin cash, litecoin, and dash each reached at least 3% of bitcoin's market capitalization. Pandl describes Zcash's recent increase as substantial but consistent with the sector's history. Using 30-day averages through September 28, the analysis shows Zcash's rise lifting it above monero, bitcoin cash, and litecoin in relative valuation.
Zcash reached approximately $1,500 by September 29, compared with about $60 a year earlier. Pandl attributed the magnitude of that rise to a low starting valuation and a large addressable market.
Privacy as Competitive Advantage
Zcash combines bitcoin-like monetary characteristics with privacy features through cryptographic techniques that conceal transaction details while enabling networks to verify transfers. The broader privacy category expanded earlier in the year, with ZEC accounting for approximately 62% of the privacy coin market value in Glassnode's September 7 snapshot.
Pandl's outlook remains conditional: "If Zcash continues to offer the most effective privacy features among competing cryptocurrencies, we think it can capture additional market share."
