Zcash (ZEC) slid below the $1,000 level on Nov. 11, local time, hitting its lowest in two months.
Cointelegraph reported that Zcash fell to $962.85 on the day. It posted the biggest 24-hour drop among the top 100 cryptocurrencies by market capitalisation.
The decline was not limited to Zcash. CoinGecko data showed bitcoin fell 5.8 percent and ethereum dropped 11.6 percent over the same period. Total market value for privacy coins also fell about 7 percent over 24 hours.
The weakness deepened after the release of U.S. inflation data. The U.S. Consumer Price Index for October rose 0.4 percent from the previous month, above the market forecast of 0.3 percent. Selling pressure across cryptocurrencies then increased, and privacy coins also weakened.
Zcash is a project that supports shielded payments that do not disclose sender and recipient addresses or the transaction amount. It is also one of the tokens that led this year's privacy-coin rally. Zcash rose 138 percent in the 30 days through Sept. 7 and remains the largest token, accounting for about 60 percent of the $28 billion privacy-coin market value.
Recent moves have sharply reversed. Zcash was still above $1,370 as recently as Nov. 7. The NU7 network upgrade applied at the time focused on speeding up transaction confirmation by cutting the target block time to 25 seconds from 75 seconds. In the process, about 12,224 ZEC that remained in the initial privacy pool became unusable.
Grayscale faced a sharp drop in Zcash a day after it said it would provide $1 million to a non-profit organisation and projects supporting the Zcash network. It converted the Zcash Trust into a spot exchange-traded fund and began trading on the NYSE Arca on Aug. 25. The fund recorded about $15 million in net outflows through last Monday. Net outflows in October totalled about $46 million.
Against this backdrop, Zcash developers have proposed reducing block time even further a few days after applying NU7. Discussions on improving network performance are continuing, but the near-term market appears more sensitive to the shock from macroeconomic data, ETF outflows and broader weakness across privacy coins.
