This paper describes the design of a capacitance readout IC for 3-D hover gesture sensing system. The proposed IC adopts a multi-channel driving scheme in both driving and sensing electrodes of a TSP (touch screen panel). The proposed single encoding and summing (ENS) filter in the readout circuit senses all TSP channels at once, thereby reducing the power consumption and chip area. An incorporated correlated double sampler (CDS) performs down-conversion of the capacitance signal and moving average filtering for severe noise interferences with high pass-filtering of the ENS filter. The proposed IC also employs an efficient hovering gesture detection method that is based on an un-folding 1-dimensional coordinate extraction scheme and various triggering events. By employing the cascade driving for hovering detection, the hover frame rate is maintained to be the same as the TSP frame rate while achieving a targeted signal-to-noise ratio (SNR). The proposed readout IC was fabricated on a 130-nm CMOS process. The IC achieves 26-dB SNR at 10-mm hover height and 120-Hz frame rate with $16\times16$ TSP. The front end circuit occupies a chip area of 0.0912-mm2 and supports a supply voltage ranging from 2.7 V to 3.3 V.