SEC Investigation Closure
Federal securities regulators have concluded a multi-year investigation into the Zcash Foundation without pursuing charges, the Virginia nonprofit disclosed Wednesday. Authorities issued a subpoena in August 2023 concerning digital asset distribution practices.
Price action for Zcash reflected the development, with 24-hour gains exceeding 12% to reach $437. Three-month performance shows the privacy token nearly doubling despite choppy conditions across cryptocurrency markets. Former SEC Chair Gary Gensler oversaw the probe's initiation under the designation "In the Matter of Certain Crypto Asset Offerings."
Foundation representatives emphasized their transparency practices and regulatory cooperation following the closure. Privacy-focused financial infrastructure development remains the organization's priority, alongside protocol stewardship for Zcash. Operations continue without modification despite the concluded regulatory review.
Regulatory Landscape and Past Cases
When approached for comment Wednesday, an SEC spokesperson provided standard language declining to address investigation specifics. Chair Paul Atkins, appointed under President Donald Trump, has overseen significant enforcement policy changes. Multiple cases against cryptocurrency companies such as Coinbase were withdrawn, and various DeFi protocol investigations ended.
Internal Zcash Ecosystem Changes
January brought significant disruption to the broader Zcash ecosystem beyond the SEC matter. Every Electric Coin Company employee departed Jan. 8 following disagreements with Bootstrap, the parent nonprofit's board. Former CEO Josh Swihart characterized the situation as constructive termination and announced plans for a new venture focused on private currency development.
Network stability operates independently from organizational changes, the Zcash Foundation stated in response to the ECC situation. A blog post distinguished between corporate transitions and protocol health. Decentralized architecture ensures $ZEC functions without dependence on specific entities or governance structures.
Creator's Perspective on Investigation
Zooko Wilcox, the protocol's creator, participated in an SEC roundtable addressing privacy and surveillance last month. His remarks disclosed that regulators had investigated him and Electric Coin Company for alleged fraud. The probe insulted his integrity and proved baseless, Wilcox stated. Complete information was provided to authorities, but no subsequent communication occurred.
Though privacy technologies and mixing services faced scrutiny under previous administration policies, Commissioner Hester Peirce's crypto task force organized the roundtable as enforcement approaches evolve. At the event, Wilcox read a statement from his mother contending that financial surveillance transforms everyone into experimental subjects.