Zcash ETP from CoinShares: Euronext Paris suspends it then reinstates it on the day of its listing

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The ZEC has nothing to do with it. The problem came from the piping which, after each purchase on the stock market, brings the securities to your account.

The CoinShares press release, dated from Jersey, did not suggest anything. ZCSH is described there as “100% physically backed by ZEC”, listed in euros on Euronext Paris from October 28, for 1.50% management fees per year. The group's boss, Jean-Marie Mognetti, focused everything on simplicity. “ZCSH is this access route to the ZEC. A title, a code, on a stock exchange that investors already use. »

An ETP (for exchange-traded product) functions like a share that follows the price of ZEC. You buy it from your securities account, without a crypto wallet or private key to manage. The issuer keeps the corresponding ZECs in a safe place. This is the same principle as the Bitcoin ETPs that BoursoBank opened to its clients last year.

On Wednesday at 9 a.m., Euronext suspended the ZCSH “until further notice”, without the slightest explanation. It was Cointelegraph which broke the story and got the last word on the story from the spokesperson for the Stock Exchange, Flavio Bornancin-Tomasella. The security would remain frozen until the central depository could provide “standard settlement operations”. Clearly, the organization responsible for delivering the securities to buyers was not ready.

The blockage did not last. A second opinion from Euronext authorized the resumption of trading at midday. At the end of the afternoon, the ZCSH sheet displayed purchase offers around 6.85 euros. CoinShares had not responded to Cointelegraph, and no one explained what had been unlocked in the meantime.

When you buy a stock, your broker displays the line within a second. However, nothing has changed hands yet. The actual exchange (the securities on one side, the money on the other) takes place two working days later. Professionals call it settlement.

A discreet actor orchestrates the operation: the central depository. He keeps the big register of who owns what. In Paris, this role falls to Euroclear France, even if Euronext has not named it. Any listed security must be registered with its identification number (the ISIN code) and a delivery circuit ready to operate.

This is probably where the ZCSH stalled. Its ISIN code begins with GB, like those of other products that CoinShares issues from Jersey. The securities must therefore go through a foreign depository before landing on French accounts. If this bridge was not ready for opening, the purchases made in Paris could not be successful. You would have paid for a title that no one was able to deliver to you.

The suspension therefore firstly protected buyers. Better a stock that has no price than thousands of orders that are impossible to honor. The exact cause (ISIN code registered too late, securities not yet created, bridge between depositories) had not been specified by either the Stock Exchange or CoinShares at the time of writing.

Machine-translated from French