The Zcash Foundation has moved past a prolonged period of regulatory uncertainty after US authorities closed a key investigation.
The decision removes a major external risk for the privacy-focused blockchain project.
It also comes during a time of internal restructuring within the Zcash ecosystem. Market participants quickly reacted to the regulatory clarity.
SEC closes multi-year Zcash investigation
The Zcash Foundation confirmed on Jan. 14 that the US Securities and Exchange Commission (SEC) has ended its investigation without recommending enforcement action.
The foundation said the regulator informed it that no charges or corrective measures would follow the inquiry.
This decision concludes a review that began after the foundation received a subpoena on Aug. 31, 2023.
According to the foundation, the subpoena related to an investigation titled “In the Matter of Certain Crypto Asset Offerings (SF-04569).”
The SEC examined potential securities law issues tied to Zcash’s funding structure and governance model.
In a statement published on its official website, the foundation said the outcome reflected its continued focus on transparency and regulatory compliance.
The organization added that it remains committed to building public financial infrastructure that prioritizes user privacy. It also confirmed that the SEC imposed no penalties and required no operational changes.
The regulator has not issued any public comment on the matter.
Zcash’s technology centers on shielded transactions. These allow on-chain verification while keeping transaction details private.
The foundation reiterated that this design aligns with its broader mission to support financial privacy without sacrificing accountability.
Market reaction
The regulatory resolution arrived during a turbulent period for the Zcash ecosystem. Earlier this month, the full development team at Electric Coin Company resigned after a governance dispute with its nonprofit board.
Former leadership described the exit as the result of deteriorating working conditions.
The developers later announced plans to form a new company and launch a wallet called cashZ, based on Zcash technology.
Despite these challenges, market sentiment improved after news of the SEC decision.
Data from CoinMarketCap showed Zcash’s token, ZEC, gained between 10% and 14% within 24 hours of the announcement.
At press time, ZEC surged to around $437, reflecting a 12.5% daily increase. Market capitalization rose to about $7.2 billion, while trading volume climbed more than 21% to roughly $791 million.
ZEC later reached an intraday high near $443. Analysts linked the move to renewed investor confidence following the regulatory clarity.
The outcome also aligns with a broader pattern of the SEC closing some cryptocurrency cases without enforcement.
Several recent probes have ended quietly, suggesting a narrower regulatory focus.
For Zcash, the end of the SEC probe removes a significant overhang as governance issues remain under review and development paths continue to evolve.