Grayscale's decision to convert its Zcash Trust into an ETF has ignited a heated debate among the privacy-coin community. For Zcash advocates, the move signifies a possible encroachment by Wall Street firms, threatening Zcash's foundational purpose of decentralization.

The filing, dated November 26, 2025, aims to transform over 394,000 ZEC, valued at around $197 million, into a regulated ETF. Critics argue that such a structure centralizes control among Wall Street firms, compromising the decentralized nature of privacy coins.

Eric Van Tassel has voiced concerns, likening ETFs to "a Trojan horse," and warning that this setup means significant control over asset values by Wall Street entities. The trust already holds about 2.4% of all ZEC, potentially increasing with ETF conversion.

This move worries the crypto industry, especially after Grayscale Bitcoin Trust's conversion led to increased sell-side pressure. The trust's high fees and the skepticism about future pricing add to the unease.

Despite these challenges, Zcash outperformed many altcoins by resisting ETF control, highlighting a more organic market movement. However, if the SEC approves this ETF, it could set a precedent, transforming Zcash from a decentralized privacy-focused cryptocurrency into a managed institutional asset.