zcash fundamental analysis and valuation

Updated

ZCash is going down in value, similar like Bitcoin and Monero did after their first rallys. The high amount of new mined coins brings constant pressure on price. Monero and Bitcoin both declined 94% in their first bear market. If this would happen to zec, price would reach 47$
The new ASIC miners are very profitable, from my calculation the production cost of zec is around 44$ if the hashrate is rising 5% per month and 88$ if rising 20% per month (Parameters used: Time: 12 Month, Cost: 10 cent per kw/h, Miner: Innosilicon Equihash A9 Zmaster, Price Miner 4000$). Satoshi Nakamoto: “The price of any commodity tends to gravitate toward the production cost.” So this may be a natural support/bottom to watch. Notice that these values must be recalculated for each new miner arriving and adjusted by hashrate growth.
While price is going down the developers remain active, the project is well funded and has some of the top cryptographers on board. The first hype is fading, whats needed now is productivity.
During the productivity phase, expect the following things to happen: Improvement of storage options: Coinbase add, Vaults and custody, Improvement of hardware wallets (shielded txs on trezor). Improvement of useability: Reduce of ram useage so that shielded txs can be done on mobile wallets.
After the new tech is available expect people to adopt, play around with it and spread the word.
Expect that the halving of the block reward in 2020 together with increasing adoption will create an imbalance in supply and demand which will likely lead to another price surge.
I believe that store of value and medium of exchange are the killer apps for crypto and that the store of value coins will be the biggest winners in crypto. I think zcash is the only real competitor to bitcoin. But the high volatility and inflation scares people to buy into it. So it's good to calculate the market cap of zcash on the total supply which currently would be around 3b. That's really not much and if it keeps falling it will be one of the best risk reward long term entry of any crypto.
My conclusion is that the best way to get into zcash is to start buying a small amount each month but also have some more cash sideline to buy a larger amount near or below the production cost as a one time investment.
My target for halving in 2020 is around 1000$ and the hype could bring it way higher after. At an average price of 100$ this would be a x10 and on 50$ x20, at the current price of 144$ it would still be a x7.

I am incredible bullish on this project and will hoard zcash during this bear phase. But always do your own reseach :) and dont forget to share what you find out.

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hashrate for zcash doubled within last month.
From my calculation, production cost with a new A9 Zmaster should be around 100$ now (if hashrate is rising 10% per month over next 12 months)

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i.imgur.com/Hy8gXis.png

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zecbtc has a chance to draw a inverse head and shoulders pattern

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sapling is activated

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the fractals of bitcoins first bearmarket more or less fits with zcashs first bearmarket. but zcash is at -90% while btc was at -94% when it bottomed.
We can not know how low crypto will go, so we can only put in money we can afford to lose. What we can be sure is that if its not going to 0 it will be way higher in the future.

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its 92% below ath price now, I am building a long term position, first buys at 65$ filled, more buys at -94%. It feels like there is blood in the streets. The sentiment is "better sell before its worthless" pretty much the opposite of the top. It's not easy beeing a buyer in these days, if it keeps going down and position size is too large, it can be very painful.

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ZEC is launching on Coinbase Pro. Starting at 10am PT.
twitter.com/CoinbasePro/status/1068203146256764928

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It nearly hit the 94%, really scary, lol. If its the bottom, people will call those who bought here "lucky to get in early" and wont recognize the pain and doubts.

Beside the zecusd if find this interesting on the zecbtc chart: The blue fractal is the weekly ltcbtc chart from 2011-2013 (directly when ltc entered the market on btc-e) and its compared to the monthly zecbtc.
If we consider altcoins as a own assetclass, ltc has the longest historical chart we can study. ltc had no premine so it should also reflect the high inflation distribution on mainnet launch.
If the fractal is valid, it seems ok to buy a breakout out of a tight consolidation sideways phase over the next months and take profit on a double top to reaccumulate over the next years again before halving.

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seems like there is a chance for a double bottom, right in the 94% decline zone

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I stick to my plan and start to hoard zec in this 40-50$ price range to hodl for some years. I believe it will either go to 0 or it will go a lot higher than it is now. It has a binary outcome.

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coindesk.com/bitmain-launches-new-zcash-miner-touting-3-times-more-hashing-power

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pretty confident that this is going up from here

zcash preparing to breakout from accumulation base

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Major milestone towards mobile wallets has been reached
twitter.com/zcashco/status/1114223827754651648

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ycash fork announced:
forum.zcashcommunity.com/t/announcing-ycash-the-first-friendly-fork-of-the-zcash-blockchain/33162

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More productivity news: Bolt testnet is coming in next week. Bolt is a LN type layer2 protocol, which is first released on zec but also compatible with bitcoin
medium.com/@boltlabs/introducing-bolt-labs-inc-ff95b673d2c

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*next weeks

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zcash hashrate hits new all time high and resumes its exponential growth
i.imgur.com/q2U3YID.jpg

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Seems like we are past the trough of disillusionment in the hype cycle
i.imgur.com/K8xO2PA.jpg

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new wallet with private/shielded tx as default
twitter.com/ZcashFoundation/status/1133721345941037056

"JPMorgan has built an extension to the Zether protocol, a fully decentralized, cryptographic protocol for confidential payments, compatible with ethereum and other smart contract platforms and designed to add a further layer of anonymity to transactions."
coindesk.com/jpmorgan-adds-new-privacy-features-to-its-ethereum-based-quorum-blockchain

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I have finished my accumulation. Hoarded the zec during the last months.
Will hodl zcash and ycash for the long term from here.

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such productivity. zcon1 agenda: docs.google.com/document/d/1Hcsi2Bd0CNuUuPiCKMavHOByFMnTsKkM6_Rw165_oe8/edit

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the current log trend would point directly to my 10b halving target. one can dream :)

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more productivity news: parity releases alternative zcash client
twitter.com/ParityTech/status/1140654711638581248

hoard the zec!

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The crypto markets went into a correction phase.

For zcash this means that price went back down to the ma200 daily (purple)

if price finds support here we could be in a livermore-like accumulation cylider, falling below would bring the risk for a bottom retest with potential double bottom.

On fundamental side the ycash fork happened, and some new long term scaling goals have been announced.
Most important for me are zcash mobile wallets with shielded tx support. I think they will be the key for regular payment adoption.

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more productivity news:

ECC discovered recursive zk proofs. Its useful to scale on layer 1 and also eliminates the trusted setup: electriccoin.co/blog/halo-recursive-proof-composition-without-a-trusted-setup/

Ethereums Istanbul Upgrade will inclue EIP 152 which allows easier interoperability between Ethereum and Zcash. github.com/ethereum/EIPs/blob/master/EIPS/eip-152.md
This opens the door for relay and atomic-swap transactions between Zcash and Ethereum

I believe that the low price doesnt match with the progress made during the last year. So I am still accumulating more zcash.

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I guess that we finally hit the bottom at 30$
There is the deadline for the feature selection on october 31, 2019.
We are exactly 1 year before the halving.
Hashrate has droped 20%, price is below production cost for some miners.

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it really looks like the bottom now. I would like to see zecbtc breaking and holding above the ma20 and reverse the ma20 so that it starts rising.
I think then the bottom would be pretty much confirmed

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The recent price rise is leading to a williams vix fix aggressive entry signal on the monthly chart (if closes like this).
This signal has been indicating the bottom for bitcoin 2 times. It has been retraced in 2015 but not in 2019.
The signal is triggering on both charts zecusd and zecbtc.

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zecbtc

Notice, i am using custom parameters:
Lookback Period = 33 | Highest Percentile = 0.82

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community poll voted to support ZIP 1014. Or like Elon would say: funding secured.
ECC: 35%, MG: 40%, ZF: 25%
electriccoin.co/blog/dev-fund-poll-shows-consensus/

At the same time the bitcoin cash seems to stop their dev fund idea to avoid a chain split. It shows how difficult it is to find consensus for such a type of change.

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around 3 month until zcash will have its first halving, seems like the price found its bottom during the last year hovering around 40$. Maybe one day we will look back at that period and price level as best time to accumulate zec.
10b market cap for halving is to far away now though. 2b seems more realistic.

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62$ at halving, looking forward how reduced block reward will effect price, and also which the first funded projects from major grants are

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seems like everybody wants to have more zec now :)

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new idea here

koryu

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