Zcash jumps 10% – But is ZEC’s rally built on speculation?

ZCash [ZEC], the privacy-focused token, is staging a solo rally today, even as other assets in the same category struggle to attract fresh capital.

The recent gains have placed ZEC among the day’s top performers, but questions remain around the sustainability of the move.

Market momentum appears fragile as perpetual and spot traders show diverging interests, with one side leaning heavily toward speculation while the other withdraws bullish support.

Speculators take control

ZEC’s dominance over the past 24 hours has pushed its price up by more than 10%, at press time, allowing the token to reclaim the $384 level on the chart.

The most evident driver behind this rally stems from the perpetual futures market, which has recorded a simultaneous increase in both Open Interest (OI) and the Funding Rate.

OI measures the total liquidity committed to an asset’s perpetual contracts, while the Funding Rate indicates which side of the market pays a premium to maintain balance.

A rise in OI signals fresh capital entering the market, which can support either bullish or bearish positioning.

A positive Funding Rate, meanwhile, indicates that buyers, also known as long traders, are paying the fee, typically reflecting bullish positioning as prices trend in their favor.

Source: CoinGlass

In ZEC’s case, $71.26 million has flowed into the perpetual market, while the Funding Rate remains positive at approximately 0.0061%. This suggests that the majority of newly opened contracts have come from long traders at the time of writing.

Such a sizable liquidity injection can exert a strong influence on price action, a dynamic already reflected in ZEC’s recent market performance.

Spot traders withdraw support

Spot market participants are not aligning with the bullish narrative around ZEC, as capital continues to exit the market.

Over the past 48 hours, CoinGlass spot exchange netflow data, which tracks whether inflows or outflows dominate, shows a clear tilt toward outflows.

During this period, total spot sales have reached $31.37 million, marking a significant sell-off. Put into perspective, spot traders have offloaded roughly 44% of the liquidity that entered the perpetual market.

Source: CoinGlass

This level of spot exit places ZEC in a vulnerable position. Historically, rallies driven largely by speculative activity, without corresponding spot demand, tend to weaken as downside risk increases.

Unless meaningful spot interest returns, ZEC appears exposed to a potential pullback, with broader market sentiment likely to deteriorate.

Downside targets come into view

The liquidation heatmap remains a useful tool for assessing whether an asset is more likely to extend its rally or rotate lower.

This heatmap displays clusters positioned above or below the current price, with varying intensities indicating areas of concentrated liquidity. Typically, price gravitates toward zones with higher liquidity concentration.

Currently, the most significant cluster is situated below ZEC’s current price level, indicating potential for a broader downward move that could push the asset toward the $350 region on the chart.

While liquidity clusters do not guarantee price movement, the growing divergence between spot and perpetual market behavior increases the likelihood of a downside swing.

Source: CoinGlass

Final Thoughts

• ZEC has recorded a sharp price surge as speculative liquidity fuels the asset’s upward move.
• Spot investors, however, are pulling back, with more than $20 million worth of ZEC sold into the market.