Zcash Tanks Double Digits After 'Meteoric Rise' Sees Leverage Build Up

In brief

• Privacy cryptocurrency Zcash has tanked 11% over the past 24 hours.
• Luke Nolan, senior researcher at CoinShares, says this drop was likely caused by a build up in leverage after the token's "meteoric rise" in recent months.
• Another expert says that growing concerns that AI could break crypto encryption before quantum computers might've prompted losses for Zcash.

Privacy-focused cryptocurrency Zcash has fallen 11% over the past 24 hours to a market capitalization of $18.5 billion, per Decrypt data, making it one of the biggest losers of the day.

One expert says this drop in valuation comes after its price has soared in recent months, which has led to a build up in leverage and amplified losses. Others say that growing concerns that AI can break cryptography faster than quantum computers are causing the privacy token to take bigger losses.

Luke Nolan, senior researcher at CoinShares, highlighted that Zcash's "meteoric rise" means that it is still up 460% from its March lows and that in a "fragile" crypto market the largest gainers tend to take losses too.

"There was a decent build-up of leverage on the way up as this is also a natural consequence of a strong move," Nolan told Decrypt. "More attention brings more perp traders to take on leverage, and when there is a sneeze, the moves get amplified as those leveraged traders are either forced to reduce exposure or get liquidated."