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An interesting thing about Zcash is that it may be the most hyped alt that is also being launched without any ICO or premine. It also plans on "slow-start mining": the amount of ZEC each time a block is mined will start at zero and gradually ramp up to 12.5 ZEC after 34 days.
So even at the B0.25 per ZEC $660 BTC $165 ZEC, the initial market caps will be low. Around $17k on the first day, ramping to $10m by the end of slow mining. Then, after a year it would get to $207m (3,600 ZEC per day).
So the irrational exhuberance in the early days could be offset by headline numbers saying the market cap is still tiny. And, the slow emission no ICO or pre-mine also means very little liquidity on the markets, which could further drive craziness.
Ironically, their attempt to be "fair" by avoiding pre-mine or ICO may lead to crazy and volatile early prices, and it may take time before the market cap is perceived to be egregious by people who just look at top line numbers.
Here is the quick analysis I put together. I just used a daily increase on block reward to reach the 12.5 on day 34, they may be using a more gradual curve.
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This is excellent analysis. The market has to balance the valuation of the crypto - currency as a whole, market cap, vs the valuation of each individual token, price in the presence of a limited and highly predictable hyper inflation during the first year. A very likely result will be an initial short lived bull market, price close to parity with Bitcoin is actually possible, followed by a brutal bear market with a loss in the 95% or higher over the subsequent 6 - 9 months. It could take several years for the price to reach the initial bull market price if at all. Here are some prior examples
1) Monero. Initial high 0.01111 XBT, Subsequent low 0.00091 XBT. Initial fall in value of the individual token over 91% in terms of XBT, higher in terms of USD, EUR etc. Monero only exceeded its 2014 per token peak over 2 years later. The market cap when the initial peak was exceeded was 10x and soon went over 20x the market cap of the 2014 peak.
2) Dogecoin. The 2014 peak was around 0.00000300 XBT the subsequent bear low 0.00000019 XBT Loss for each individual token over 93%. Dogecoin has not seen 0.00000300 XBT since.
3) Dash. Now in this case the phenomenon was mitigated by the instamine; however in spite of the instamine the effect was still present. The 2014 peak was around 0.02740 XBT the subsequent bear low 0.00215 XBT. Loss for each individual token over 92% in terms of XBT
So my take with Zcash is wait about 6-9 moths and then see.
