Valuation models comparing Zcash (ZEC) and Bitcoin (BTC) produce a wide spectrum of potential values, underscoring the inherent challenges in quantifying ZEC’s worth, particularly due to its shielded transactions and differing network activity metrics. Analyst filbfilb has developed these models to assess Zcash’s valuation relative to Bitcoin, incorporating various network metrics and accounting for Zcash’s privacy features. The outputs vary significantly based on different assumptions and scenarios.
Comparative Network Metrics
Both Zcash and Bitcoin share a maximum supply of 21 million coins. Zcash currently has just under 17 million coins in circulation, a figure comparable to an earlier stage in Bitcoin’s issuance history. However, according to filbfilb’s analysis, Zcash’s transaction activity at an equivalent issuance stage represents approximately 3.71% of Bitcoin’s. Applying this percentage to Bitcoin’s historical market capitalization yields an implied ZEC price of around $254.
Filbfilb’s further analysis indicates that Zcash presently processes about 1.01% of Bitcoin’s transaction count. When this current metric is applied to Bitcoin’s present market capitalization, it suggests an implied value of approximately $944 per ZEC. Both of these implied valuations remain below ZEC’s recent surge, which saw the cryptocurrency approach $1,300.
Accounting for Shielded Transactions
Zcash’s privacy features, specifically its shielded transactions, complicate direct valuation comparisons. Filbfilb assumes that 58% of Zcash transactions are shielded and that these shielded transactions carry the same average dollar value as observable ones. This assumption is then used to adjust the valuation models.
Under these adjusted conditions, Zcash’s network value reaches approximately 12.34% of Bitcoin’s equivalent-stage transfer value, a notable increase from the 3.71% derived from transaction activity alone. A blended approach, equally weighting these two measurements, results in an estimated network progress of about 8.03%.
Hypothetical Scenarios and Limitations
Filbfilb explores hypothetical scenarios for Zcash’s valuation, using Bitcoin’s current network valuation as a benchmark. In a transaction-only model with a hypothetical 100% value capture, the implied ZEC price is roughly $3,457. A blended model, incorporating assumptions about shielded transactions, reaches approximately $7,480. Further scenarios with 25% and 50% capture assumptions suggest implied prices of $1,870 and $3,740, respectively. It is crucial to note that these figures represent potential scenarios and are not price targets or probabilities.
Filbfilb has also highlighted significant limitations inherent in these models. These include fundamental differences between the architectures of Zcash and Bitcoin, and the inherent difficulty in precisely measuring the dollar value of shielded transactions. The analyst argues that comparing circulating supply alone offers little insight into valuation and that Zcash’s ability to continue closing the gap with Bitcoin may ultimately influence its valuation.
These models collectively emphasize that Zcash, even at recent highs, appears relatively expensive when measured against its current network achievements. Filbfilb’s work underscores the range of possibilities rather than definitive outcomes, with substantial uncertainties persisting regarding the future convergence between the two networks and the precise impact of Zcash’s privacy features on its long-term valuation.
Why This Matters
The materials describe a narrow update: Analyst filbfilb created models to assess Zcash’s valuation relative to Bitcoin, considering factors like circulating supply, transaction activity, and transferred value, with adjustments for Zcash’s privacy features. The exact dollar value of shielded transactions in Zcash.
Broader Context
Source materials place the market analysis in this context: ZEC’s most recent surge, which got it close to $1,300, has managed to revive considerable comparisons between it and Bitcoin – in particular because both of them have a maximum supply of 21 million coins.
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