Zcash's native token, ZEC, is trading around $1,330 on Monday, recovering from a weekend low of $1,254. The rebound follows the activation of the NU7 network upgrade on the testnet, a key step before the proposed mainnet launch.
NU7 Testnet Activation
On Oct. 4, at block 4,465,026, Zcash activated NU7 on its testnet, as confirmed by the Zcash team and the ZecBlock explorer. This move allows developers and infrastructure operators to test the new rules in a live environment, ahead of a potential mainnet deployment targeted for Nov. 5. The final activation height is expected to be decided on Oct. 20.
Key Changes in NU7
One of the most significant changes is the reduction of target block spacing from 75 seconds to 25 seconds. This would allow the network to produce blocks more frequently, potentially speeding up transaction confirmations. However, actual block times may vary.
NU7 also introduces a Network Sustainability Mechanism, which redirects a portion of transaction fees into future block rewards. This alters how miners are compensated, blending immediate rewards with future incentives.
Another notable change is the disabling of version 4 transactions, which affects ZEC held in the legacy Sprout shielded pool. Once NU7 activates on mainnet, funds remaining in Sprout would become unspendable unless users migrate them beforehand. This creates a migration requirement for affected holders.
Market Outlook for ZEC
From a technical perspective, ZEC's daily chart remains bearish after dropping below $1,300 on Friday. The coin has since recovered, but momentum indicators are mixed. The RSI stands at 58, above the neutral 50, while the MACD lines remain positive, suggesting some bullish control.
If the recovery continues, ZEC could target the Inducement Liquidity (ILQ) level at $1,505, and potentially reclaim the recent high of $1,701. However, if the bears regain control, the first major support is at the weekend low of $1,254. A break below that could lead to a decline toward the $1,100 psychological support level.
Investors are watching whether the testnet phase reveals any issues that could delay or alter the mainnet activation. The outcome of the Oct. 20 decision will be crucial for ZEC's near-term trajectory.
This article is for informational purposes only and does not constitute financial advice.
