Not everyone caught on the wrong side of Zcash's record run this week is still holding their position. As ZEC pushed through $1,580 on September 19, on-chain trackers logged at least two prominent short sellers getting overrun by the rally, one already forced out at a multi-million-dollar loss and another watching a paper loss balloon in real time.
The clearest casualty came from a trader tracked by on-chain analyst Yu Jin, who had held a $24.43 million ZEC short for roughly half a month before being forced to close it at $1,548, realizing a $10.68 million loss. It is a sharp reversal for a trader who, according to the same monitoring, had a 79% historical win rate and had booked $9.11 million in cumulative profit since June. Half a month is not a long time to hold a losing position of that size, which suggests the trader was sizing up for a pullback that never came before the position was unwound at a loss.
A second, larger short is still open, and still bleeding. Lookonchain identified trader Garrett Jin as currently holding the largest ZEC short in the market, now sitting on a $33.66 million unrealized loss with a liquidation price of $4,792.01. Notably, Jin is not purely betting against the market. The same wallet holds a 1,333 BTC long worth roughly $108.57 million that is up about $4.5 million, meaning the ZEC short losses are, for now, being offset on paper by gains on the Bitcoin side of the book. Whether that balance holds depends heavily on where ZEC trades from here, since a liquidation price above $4,700 is still a long way from the current $1,550 range, leaving room for the position to keep losing before it is forced out.
A Rally That Feeds on Its Own Shorts
Short squeezes tend to be self-reinforcing: as a price breaks higher, leveraged short positions are forced to buy back the asset to close out or avoid liquidation, and that forced buying pushes the price higher still, which in turn threatens the next batch of shorts. Zcash's move from a mid-cap privacy coin to one of the ten largest cryptocurrencies by market value this year has played out exactly that way, compressed into a matter of weeks rather than months. On-chain trackers have flagged a steady stream of whale deposits and trader closures around the token, including a separate $362 million transfer from a long-term holder into Coinbase, alongside the short-side pain documented here, a sign that both bulls and skeptics are actively repositioning rather than sitting still. That kind of real-time wallet surveillance has become routine across the industry this year, the same tooling that recently let authorities in Japan, the United States and Germany jointly expose North Korea's WaterPlum crypto hacking network.
Zcash is not the first token this year to put leveraged shorts through a wringer like this. Bitcoin's break above $80,000 earlier this month triggered a similar cascade of short liquidations, with HYPE and other altcoins riding the same wave higher. The mechanics are consistent across both moves: a breakout above a key level, forced buying from shorts trying to limit losses, and a rally that runs further and faster than the fundamentals alone would suggest.
For traders still short ZEC, the math is getting less forgiving by the day. A $4,792 liquidation price looks distant at current levels, but so did $1,000 a few weeks ago. Whether the token's next move validates the bearish case or extends the squeeze further will likely determine how many more forced closures show up in on-chain data before the week is out.
