A privacy-focused analyst on X is making a straightforward point about Zcash: the supply that can actually move markets may be smaller than people assume.
The post starts with simple math. There are only around 16,000,000 ZEC in circulation. If roughly 31% of that supply is shielded (about 5,000,000+ coins), the argument is that those coins have lower “velocity,” meaning they tend to move less often. That leaves a little over 10,000,000 ZEC that is openly tradable.
From there, the analyst ties supply dynamics to price behavior. As ZEC price rises, tradable coins get “squeezed,” especially if exchanges are holding fewer coins that are readily available to sell. The projection in the post claims that around $1,000 per ZEC, the openly tradable supply could fall into the 8,000,000–9,000,000 range, leaving exchanges with only a thin layer of “free coins” to work with.
What you'll learn 👉
What the chart is trying to show
The image shared alongside the tweet is a stylized “market structure” chart with two lines moving in opposite directions.
The solid line labeled “ZEC PRICE ↑” slopes upward over time, moving from roughly the low $100s area toward $1,000+ in the right-side projection zone. The dashed line labeled “TRADABLE SUPPLY ↓” trends downward over the same period, dropping from the 12,000,000+ range toward the 9,000,000–10,000,000 range on the right-side axis, which is marked in “millions of ZEC.”
In plain terms, the chart is presenting a thesis: if ZEC demand pushes price higher while fewer coins remain readily tradable, price moves can become sharper because liquidity is thinner.
Is the “supply squeeze” logic fair?
The core idea is reasonable: markets move more aggressively when order books are thin and supply is tight. If exchange inventories fall while demand picks up, even modest buy pressure can move price faster than expected.
But the key word is “if,” because this thesis leans heavily on assumptions.
Shielded coins are not permanently locked. They can be moved back into transparent form, and holders can decide to sell at any time. In other words, “lower velocity” is real as a behavioral claim, but it is not a hard supply cap.
Exchange balances also change quickly. Coins flow on and off venues based on volatility, funding rates, and short-term positioning. A squeeze narrative can look powerful on a chart, then fade the moment liquidity returns.
Read also: Litecoin Could Overtake Zcash as the Go-To Privacy Coin, Says Crypto Expert
What would make this thesis more believable
This kind of view becomes more credible when multiple data points line up at the same time.
One is persistent growth in shielded usage, not just a one-off spike. Another is sustained declines in exchange balances across major venues. A third is rising spot demand that is not purely driven by leverage.
If those inputs trend in the same direction, the “shrinking tradable supply” story holds together better. If they do not, the chart stays a clean visual, but it remains a projection rather than a market fact.
The takeaway
The analyst’s post is basically a warning against assuming ZEC has deep liquidity just because the market cap looks large enough. The chart frames Zcash as a market where tradable supply can tighten while price climbs, which can amplify upside moves but also increase volatility.
The thesis is worth tracking, especially in a market where privacy narratives can return quickly. But it should be treated as a scenario, not a guarantee, because tradable supply can expand again the moment holders decide to rotate coins back onto exchanges.
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