Zcash Foundation in the Clear: SEC Ends Years-Long Probe With No Enforcement Action

The Zcash Foundation said this week that a years-long investigation by the US Securities and Exchange Commission has ended without any enforcement action, bringing regulatory clarity to one of the crypto industry’s most closely watched privacy projects at a time of heightened volatility for the token.

In a notice published Wednesday, the foundation confirmed that the SEC had “concluded its review” of an inquiry tied to “certain crypto asset offerings.”

The probe began in August 2023, when the foundation received a subpoena as part of a broader SEC effort to assess whether specific digital asset offerings fell under federal securities laws.

The case was internally designated SF-04569 and remained open for more than two years.

Zcash’s Privacy Model Back in Spotlight After SEC Review Closes

The foundation said the outcome reflected its cooperation throughout the process and its focus on operating within existing regulatory requirements.

It added that its work would remain centered on advancing privacy-preserving financial infrastructure. The SEC did not issue a public statement on the matter, but the foundation said it had received confirmation that the review was formally closed.

The decision comes amid renewed market activity around Zcash, with ZEC trading around $439 on Wednesday, up roughly 13% over the most recent trading period, with 24-hour trading volume climbing more than 30% to about $881 million.

Despite the rebound, the token remains far below its early-cycle peak, trading more than 86% under its all-time high of $3,191 set during the 2017 bull market.

One of the most prevalent aspects of privacy-oriented cryptocurrency has always been the regulatory oversight of such initiatives, which have been based on cryptographic solutions to conceal the information on transactions and remain functional in the open blockchain.

Zcash was introduced in 2016, and it uses zero-knowledge proofs to enable users to transact shielded transactions without the information about the sender, receiver, or amount being disclosed.

That design has put it in the middle of multiple discussions on financial surveillance, compliance, and the boundaries of privacy on-chain many times.

SEC’s Zcash Decision Mirrors Evolving U.S. Regulatory Playbook

The SEC’s review of the Zcash Foundation unfolded alongside other inquiries touching the ecosystem.

In past correspondence, the agency sought analysis from Grayscale Investments on whether ZEC could be classified as a security in the context of its Zcash Trust.

SEC officials have also engaged directly with Zcash founder Zooko Wilcox, including participation in roundtable discussions on privacy technologies and regulatory oversight.

The closure of the Zcash probe also fits into a broader shift in US crypto enforcement since 2025.

Under new leadership and following the appointment of Paul Atkins as SEC chair, the agency has dropped or settled a string of high-profile cases launched during the prior administration.

Lawsuits against Coinbase and Kraken were dismissed without penalties, investigations into Robinhood’s crypto unit, Uniswap Labs, OpenSea, and Gemini were closed, and a multi-year inquiry into Ondo Finance ended without charges late last year.

While the SEC has continued to pursue cases involving alleged fraud, the pattern has pointed toward a pullback from expansive enforcement actions tied to token classification alone.

The end of the SEC probe arrives during a turbulent moment internally for Zcash, as last week, governance disputes between the Electric Coin Company and the nonprofit Bootstrap escalated into a public split, with core developers leaving to form a new independent entity.

That episode briefly weighed on market sentiment, even as network operations continued uninterrupted and project leaders stressed that the conflict did not affect Zcash’s underlying security or privacy guarantees.