- Tyler Winklevoss backs ending ZCG’s 8% block reward allocation amid funding concerns.
- Sean Bowe proposes redirecting ZCG’s future funding to the NSM while preserving its treasury.
- Josh Swihart proposes redirecting both ZCG and coinholder funding streams to the NSM.
Tyler Winklevoss has backed calls to end the 8% block reward allocation to Zcash Community Grants (ZCG) as developers debate its accumulated funding. His support follows Zcash co-founder Sean Bowe’s proposal to redirect that allocation to the Network Sustainability Mechanism (NSM) while preserving ZCG’s existing treasury.
Bowe said the program currently holds more than $125 million and would receive millions more before payments stopped.
ZCG Treasury and Grant Decisions Draw Scrutiny
Bowe’s draft Zcash Improvement Proposal focuses on ending future payments to ZCG. He argued that the program was never designed to handle its current funding level. The draft would send that 8% share to the NSM while leaving the separate 12% coinholder allocation in place. ZCG would retain control of the funds it already holds.
Maxime Desalle of Winklevoss Capital criticized ZCG’s spending on Zcash Shielded Assets (ZSAs). He said the grants program spent $5.76 million over five years on their development, despite coinholders voting 98.6% against the assets earlier this year. Desalle added that ZCG approved another $455,000 for ZSAs in June, questioning the program’s accountability.
Desalle has also proposed ending ZCG at Network Upgrade 8. His approach would stop new grant approvals, while Bowe’s draft would preserve the program’s existing funds.
Follow us on X for real-time crypto updates.
Should Zcash End Both Funding Streams?
Josh Swihart of Zcash Open Development Lab (ZODL) argued that ending only Zcash Community Grants (ZCG) funding would leave a similar issue with the separate coinholder funding stream. He said that stream accumulates approximately 216 ZEC per day until the next halving. Swihart proposed redirecting both funding streams to the Network Sustainability Mechanism (NSM).
Under his proposal, ZCG would honor all approved grants before transferring its remaining funds to the NSM. One possible exception would be a one-time legal defense endowment for Zcash developers, subject to coinholder approval.
Swihart said ZCG funding had supported ideas that needed incubation and helped balance governance. He described coinholder grants as a bridge away from direct funding when resources were scarce, adding that the arrangement had served its purpose.
Swihart also disclosed that ZODL recently received a retroactive coinholder grant for core protocol work and would apply for future grants if the fund continued operating. He argued that retiring the entire fund would eliminate that potential source of future funding.
Bowe challenged the proposal to link the two funding streams, calling it a “false dichotomy.” Swihart responded that differing views and debate over the trade-offs were acceptable.
Subscribe to our YouTube channel for the latest crypto news.
Related: Zcash Co-Founder Proposes Redirecting 8% of Block Subsidies to Network Sustainability Mechanism
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
