Zcash Fees Surge, Surpassing Ethereum and Solana in November

In a sharp shift in market dynamics, Zcash fees surged as on-chain activity and speculative trading drove the privacy coin to the top tier of revenue-generating networks.

How did ZCash overtake Ethereum and Solana on fees generation?

ZCash (ZEC) emerged as one of the most active crypto assets over the past 30 days, both on exchanges and on-chain. During this period, the ZCash network generated $47.5M in fees, surpassing Ethereum and Solana despite lacking a rich ecosystem of decentralized apps. Moreover, this spike in revenues coincided with an aggressive price rally and a rush of speculative interest.

The chain’s heightened usage pushed it ahead of Solana and Ethereum in terms of fee production, ranking it directly behind TRON as the second-biggest network by fees over the past month. That said, the record arrived even as additional ZEC volume flowed through its Solana-based DeFi representation, which is traded on decentralized exchanges and contributed further liquidity.

Part of the activity was tied to the Orchard privacy pool, where near-record transfers were recorded for bridging and moving ZEC into its shielded form. However, despite the impressive metrics, questions remain over the sustainability of this surge and the underlying motivations of large holders.

When did ZCash reach peak on-chain and transaction activity?

The latest rally in ZEC prices matched the highest level of on-chain activity in the network’s history. ZCash transactions peaked in November as the coin spiked above $700, marking its strongest showing since 2018. According to Bitinfocharts, daily transactions hit more than 73K on November 13, before cooling to a higher baseline than in previous years.

Previously, the network had seen almost negligible transaction counts, even as some advocates claimed ZEC could one day displace BTC as a payments asset. Moreover, the renewed activity was not limited to the mainnet. Usage also increased on ZEC’s Solana-based version, which is integrated into DeFi protocols and provides additional avenues for trading and yield strategies.

The burst in zcash network activity turned the chain into the second-biggest fee producer after an all-time spike in November. Data from Token Terminal shows that ZCash’s $47.5M in fees represented roughly 2.6% of all fees generated by major blockchains during the period, underscoring how abrupt the shift in market behavior has been.

How concentrated is the recent ZEC usage?

Despite the strong headline numbers, the distribution of transactions suggests that relatively few wallets drove much of the recent volume. ZCash now ranks 13th by the number of daily active wallets, with around 11.59K addresses moving coins on the main network. However, this still points to a concentrated user base rather than broad retail adoption.

The rally also triggered renewed attention to Zcash whale activity, as on-chain analysts highlighted large transfers and repeated cycling of coins between wallets. Moreover, the prominence of the Orchard pool and bridge movements fed speculation that sophisticated traders were using shielded transactions to quietly reposition or exit their holdings.

As a result, ZEC’s rise has been met with suspicion by some market participants, who see the pattern as more aligned with tactical liquidity extraction than organic growth in real-world usage. That said, others argue that privacy-focused users naturally prefer to keep their activity opaque, making definitive conclusions difficult.

Is the latest ZEC price action a whale exit strategy?

The latest ZEC breakout carried the price to levels last seen in 2018, with several spikes above $700. This fuelled theories that the coin’s sudden strength was being used as an exit ramp by early buyers, miners, or actively trading whales. ZEC had previously spent years consolidating while liquidity and attention shifted to other sectors.

As the market turned, ZCash became a vehicle for a series of short squeezes, forcing leveraged bears to cover their positions. Yet the coin has struggled to hold its highs. After the most recent failed attempt to reclaim $700, ZEC retreated to $562.94, seemingly abandoning—for now—its push toward the psychological $1,000 threshold.

One prominent theory suggests that, beyond social media buzz and the interest of crypto influencers, ZEC is being used to anonymously unwind long-held BTC positions. The timing of the ZEC surge coincided with a record number of old BTC whales moving coins, which led some analysts to propose that profits from Bitcoin were being rotated into and out of ZEC via shielded transactions.

What role do mining and network security play in the ZEC narrative?

The spike in transactions lined up with a significant jump in mining activity. The Zcash mining hashrate on the main chain is now near an all-time high, having roughly doubled since June. This growing computational power points to increased miner interest and potentially higher security for the network’s proof-of-work consensus.

Higher hashrate typically signals that miners expect sustained profitability from block rewards and fees. Moreover, a rising cost to attack the network can reassure long-term holders that the chain remains robust, even as short-term trading remains volatile. For ZEC, this mining expansion has become a critical counterpoint to concerns about speculative excess.

However, skeptics argue that if whale-driven rallies are temporary, miners could again face pressure should price and fee revenues normalize. The balance between sustainable income for miners and fair zcash transaction fees for users will be closely watched in the coming months.

Can ZEC sustain momentum after its latest downturn?

Despite recent volatility, ZEC has shown resilience by repeatedly bouncing from sharp drawdowns through fast, liquidity-driven squeezes. Still, the broader sector of privacy coins has stepped back. Their combined market capitalization has fallen below $20B, with ZEC remaining a leader and XMR following, while many smaller assets have fully retraced prior rallies.

Derivatives data paints a cautious picture. ZEC short positions now account for about 55% of open interest, though only 44% of whales on Hyperliquid are positioned short. Of those larger traders, many are reportedly paying high funding fees to maintain their bearish exposure, hinting at persistent expectations of further downside or, at minimum, capped upside.

In the near term, analysts see limited probability of a decisive break above $700, given the current structure of open interest and the constrained potential for another aggressive short squeeze. However, the market remains vulnerable to sudden moves. The ZEC price could still spike to around $620 if enough shorts are forced to cover quickly.

Are retail traders taking on the risk from early ZEC holders?

The history of ZEC distribution continues to shape perceptions of the current market cycle. Over the years, large amounts of ZEC have accumulated in the wallets of early whales and miners, while more recent buyers tend to enter during explosive rallies. That said, each new surge appears to transfer risk from sophisticated holders to a fresh wave of retail traders.

ZEC has already suffered multiple sharp crashes from above $700, reinforcing fears that each rally could be exploited as an opportunity for bigger players to unload inventory. Moreover, critics argue that these recurring patterns undermine confidence in the asset’s long-term value proposition, even as supporters emphasize its unique privacy features and evolving technology stack.

Ultimately, the latest spike in Zcash fees production, price action and mining strength underscores how quickly narratives can shift around a mature yet controversial asset. Whether the recent cycle proves to be a durable turning point or another exit phase for long-term whales will depend on how usage, liquidity and transparency evolve from here.

In summary, ZCash’s surge in fees, hashrate and trading activity has propelled it ahead of larger smart contract platforms, but lingering concerns about concentration, whale exits and sustainability continue to cloud its long-term outlook.