Community Sentiment Polling Results (NU4) and draft ZIP 1014

Poll thread: Community sentiment collection: Poll on NU4 dev fund ZIPs!

Added by @daira : PR for draft ZIP 1014; published draft ZIP 1014


If we combine both results (advisory panel + forum) it seems that proposal 12 won the polling:

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ZF’s statement is out:


Kudos to @Josh and ZF’s board for this important step in converging towards a decision, and the diligent sentiment gathering (formal and informal) that lead to it.

I’m honored that my proposed ZIP 1012, building on @mhluongo’s ZIP 1011, was recommended as the basis for forthcoming discussion. I support revising ZIP 1012 to accomodate clear community sentiments. The obvious caveats are ensuring that the results remains executable, and being careful about interactions since there are many interdependent governance, accountability and incentivization mechanisms.

I would like to offer some initial comments on the planned revisions, and also make some process commentary. Please excuse the length of this post; it mostly summarizes things said elsewhere, but collects them in one place.


  • Add ZIP 1010’s accountability requirements, either through a legal trust or some other means.

I support implementing the strongest form of accountability that’s feasible. The reason I did not integrate the legal trust approach is that I’m apprehensive about finding a trustee willing to undertake this duty, given the technical, legal and regulatory complexities. This introduces costs in time and fees, and a risk that the idea will prove infeasible.

I suggest to integate the Trust mechanism, but also specify that if this proves infeasible (as judged by consensus of ECC and ZF after their best efforts), then as fallback the existing accountability mechanism of ZIP 1012 will be used. Copied here for convenience:

For grant recipients, these conditions should be included in their contract with ZF, such that substantial violation, not promptly remedied, will cause forfeiture of their grant funds and their return to ZF.
ECC and ZF will contractually commit to each other to fulfill these conditions, and the prescribed use of funds, such that substantial violation, not promptly remedied, will permit the other party to issue a modified version of Zcash node software that removes the violating party’s Dev Fund slice, and use the Zcash trademark for this modified version. The slice’s funds will be reassigned to ZF-MG (whose integrity is legally protected by the Restricted Fund treatment).

Another difference is that the reporting requirements of ZIP 1012 are more rigorous and explicit than those of ZIP 1010’s. I suggest to keep the rigorous reporting requirements, but there is flexibility here.


  • A major difference between ZIP 1012 and ZIP 1013 is the presence of a dollar-denominated cap in ZIP 1012. We’re in favor of this cap for the Foundation, but we don’t think such a cap is necessary for the ECC if we add ZIP 1010’s strict accountability requirements.

This planned revision strikes me as weird and undesirable, for several reasons.

First: ZF, being a 501(​c)3, is subject to strict regulatory constraints on its use of funds. These regulations don’t apply to ECC. So it seems upside-down to place a cap on ZF but not on ECC.

Second: my impression was that USD cap is widely supported, based on sentiments expressed in many community discussions.

Third: Recall ZIP 1012 (unlike some other proposals with a USD cap) does provide an upside to the Dev Fund recipients, even if the USD price exceeds the monthly USD cap (Funding Target). If that happens, the excess coins are not burnt or redirected, but rather deposited into the Volatility Reserve of that same recipient. They can then be withdrawn from the Volatility Reserve whenever it’s needed in order to top-up the income to the Funding Target. Thus, in effect, the excess ZEC go towards extending the runway instead of increasing the burn rate. Moreover, there’s a mechanism for increasing the Funding Target.

For all of those reasons, I suggest applying the Volatility Reserve mechanism to all parties, though there’s certainly room for relaxing it (e.g., increase the default Funding Target, or change the Funding Target update mechanism to make it easier to increase; @mlphresearch’s analysis made a similar point).

Grant Review Committee

  • The inclusion of the Grant Review Committee as specified in ZIP 1010 to determine Major Grant disbursement rather than the ZF board, with explicit authority to disperse these restricted funds added to the ZF bylaws.

In principle, I would love to have an independent Grant Review Committee. However, I am apprehensive about decentralized means to appoint it.

In particular, there are major issues with the committee composition that ZIP 1010 prescribes:

The ZF Grant Review Committee would be compromised of five members, voted on in the following manner:*

  • 1 seat for the ECC. Though the appointed member may change, they retain power to choose the seat for 4 years.
  • 1 seat for the Zcash Foundation. Though the appointed member may change, they retain power to choose the seat for 4 years.
  • 2 seats voted on by ZEC holders directly, elected every year. There would be open elections held by the Foundation similar to the 2018 advisory process which resulted in Ian and Amber’s election, except using a ZEC coin-staked vote directly.
  • 1 seat held by a technical member, elected every year. This member would be selected by the combined group (2 coin-staked seats + ZF seat + ECC seat) with an express focus on ability to evaluate technical proposals.

To summarize the forum discussions:

Half of the committee is controlled by “ZEC holders directly”. Such coin-weighted voting has severe problems. If these are two seats captured, then the others two seats don’t suffice to mitigate the damage (and there would be a deadlock on electing the 5th, technical member). That’s creates a very bad risk of capture, for a committee that controls the disbursement of many tens of millions of dollars. References:

More generally, I fear that the problem of conjuring an independent grant committee is basically the general “decentralized governance” problem in disguise, and we’re not going to solve it here either.

Another problem is the presence of an ECC member on the Grants Review Committe. This causes an unacceptable conflict of interests when awarding grants to ECC, and also for all other grants because they compete with ECC for funding.

(Recall that, in the rationale and design of ZIP 1012, it is crucial that ECC can compete for Major Grants, in order to sustain its operations until concrete opportunities arise to create even greater value for the Zcash ecosystem. If ECC is not allowed to compete for Major Grants, then its dedicated slice needs to be much larger.)

Thus, unless and until a better solution to this governance problem is found, I reluctantly suggest to keep the weak language (“ZF shall strive to create an independent grant committee”) of ZIP 1012, or similar. Or be more specific and prescribe, as @mlphresearch suggested, to compose an independent grant committee by a sentiment collection process, followed by final decision by the ZF board.

Board composition

  • With the addition of the explicitly specified Grant Review Committee, changing the ZF board election requirements to be advisory, but retaining the requirement for ZF board members to divest themselves of ECC equity. […]

Indeed. The phrasing in ZIP 1012 is meant to be flexible enough to accommodate whatever is the state of the art, but it’s indeed fine to clarify that board voting may remain advisory.

Dev Fund ZIP revision process

Lastly, I would like to raise a process issue.

ZF should proceed very cautiously in modifying ZIPs, and recognize that the more it changes the ZIPs that were voted on in the sentiment collection, the further it strays from established consensus into the territory of centralized discretion.

The ZIP authors (myself included) have no special standing in forming the consensus on revisions, and even if I happen to personally approve of changes to my proposed ZIP, this is no way indicates that the modified ZIP retains or improves its original widepsread approval. Perhaps my tastes happened to diverge from the community on these specific changes?

Furthermore, the narrative of “merging” ZIPs is alluring but misleading. We have good signals on monolithic ZIPs, but not on which components people approved or disapproved of. When merging ZIPs, we run the risk of removing the elements that many people did like, and choosing elements that are widely disliked. A merged ZIP may look fine to the authors of the original ZIPs, but may be judged by the community as worse than either of the original ZIPs. Worse yet, if it’s hurried through because it’s “merely a merge” then the community may not put in the time and effort to notice the problems in time.

I thus urge ZF to use all the means at its disposal to gather community sentiments about all the changes it’s making, including clearly explaining what changes were made and why; explicitly calling for specific feedback and focused ad-hoc polls; and if the changes are major, repeating the structured sentiment collection on the forum and Community Governance Panel.


“Funding is capped at $700k/month per slice. Governance and accountability are based on existing entities and legal mechanisms, and increasingly decentralized governance is encouraged.”

I like this part of the ZIP proposal very much. As someone who expects ZEC to appreciate in value significantly I was worried that a sharp increase in the price of ZEC could promote non-necessary spending by either the ECC or the ZF.


Thanks to this and other feedback @tromer and @azrael the Foundation decided to significantly scale back its modifications to ZIP 1012.

To summarize:

  • No trust requirement
  • Cap at $700k + volatility reserve concept is intact for all slices
  • Major Grant Review Committee established outside of ZF Board with nearly complete autonomy on funding (outside ZF board) but different makeup than ZIP 1010, uses community advisory panel to elect
  • ZF board stays self-directed, but encouraged to take advisory input from community advisory panel
  • Since this is a still a changed proposal, we’ll be conducting a combined Helios vote on this proposal (with those eligible accounts that participated in both the forum and community advisory panel)

You can read more about our proposed ZIP here:

Or check out the PR with the diffs from ZIP 1012 here:

Thanks again for your feedback and voicing your concerns!


I’ve reviewed these changes and fully support them. In particular, my concerns (above) are adequately addressed.

I particularly like having the Major Grant Review Committee be autonomous and binding, and the improved Funding Target update mechanism.

It’s also great to have this clear community process for approving the revised proposal.

Thanks, @acityinohio and ZF board, for the diligent work you’re doing in listening to all sentiments and rationale!


The market has also given us a strong positive signal that we are going in the right direction. This cannot be a coincidence. Not in a downtrend like this while none of the other altcoins are gaining value.


I like it, lots :slight_smile:

There’s a part on handling excesses that I find confusing :-

Any excess is kept in a reserve by each organization, from which it can be withdrawn only to maintain the funding target in the future.

Each org owns & manages their own reserve? Shouldn’t excesses be routed to a central/generic reserve, perhaps the major grants slice & funds tagged for future use? Just a thought.


Yes, and this was already in the original ZIP 1012 version that was voted on. It’s not ideal, but the alternative is to have some other trusted parties maintain the reserve, which introduces even more risks and complexities.

Like several other requirements, legitimate use of the Volatility Reserve will be enforced by legal and reporting obligations, as well as the possibility of hard-fork (supported by the trademark agreement). I believe that with clear requirements in place, these enforcement mechanism are adequately effective.

The other consideration here is that reserve really is earmarked for the respective organizations, because this gives them a financial “upside” for increasing the value of the coin. But the upside is not in the form of immediately-available funds (people raised concerns about short-sighted spending), but rather, in the form of increased runway, and the possibility of increasing the Funding Target subject by community decision.


That works for me :slight_smile:

First of all I want to say I am happy with the top two proposals selected by the community, @tromer’s proposal and the ‘keep it simple’ proposal which simply split funding 50/50 between the ECC and the foundation.

However, I actually think I preferred the original proposal where “40% for additional “Major Grants” for large-scale long-term projects (decided by the Zcash Foundation, with extra community input and scrutiny).” That is, I preferred simply letting the Foundation have the power to administer the major grants.

I’m not convinced that electing a 5 person committee would be better than the ZF board. What accountability is there for this 5 person committee?

Also, I feel the Foundation is ignoring the fact that the “keep it simple” proposal with received the 2nd most community support. The foundation is trying to merge ideas from the foundation directors @acityinohio’s proposal #10, which received less support than the ‘keep it simple’ proposal.

I really liked the original version of @tromer’s proposal and it seems reasonable to select this proposal, since after all it was the community’s most popular choice. But shouldn’t we give some consideration to the second most popular proposal? Maybe the strong support for the ‘keep it simple’ proposal reflects a community desire to fully fund the ECC.

What about voting on proposal #12, the most popular choice, but with new options for the percentages of funding for the ECC, the Foundation and for the Major grants?

If we are not going to give the ECC enough funding to prevent them from winding down, then we should make absolutely certain this is will of the community. It’s certainly not obvious that this is the will of the community when the second most popular proposal fully funded the ECC.

I have stopped advocating so strongly for my own proposal to build a voting system, because it didn’t receive as much support as proposals #12 and #13, though it was among the top few. I understand @acityinohio wants to merge more elements of his own proposal into the top choice proposal, and that is fine and logical because his proposal got some significant support, but I think it is wrong to so completely discount the second most popular choice of the community in favor of a proposal written by the Foundation director.


Will community be okay with not having major grant committee and just ZF making those decisions for now? It can be done eventually done in a decentralized way but having another centralized set of folks might add more complexity in the mix.

Updated with new poll

  • Yes! We want major grant committee
  • No! I love ZF, no need for another centralized group making decisions
  • I’m fine with both

0 voters

@aristarchus, I think the reason it’s hard to integrate elements of #13 (“keep it simple”) is that, by design, there aren’t very many of them… The main point of #13 is guaranteeing the slice allocation percentages, and in a sense of most of the proposals (including #10 and #12) already incorporated that outlook, but added elaborations for better governance and opportunities for 3rd parties. For example, #10 just guarantees %50% to ECC, whereas #12 gives ECC between %35 and %75 depending on how competitive are their Major Grant applications. So really you can pick one or the other, but it’s not clear how you would combine them.

About the Major Grants Review Committee: note that even in the past, with the Foundation having unfettered dominion over its budget, it voluntarily created grant review committees populated by independent members, and the board signed off on the committees’ recommendation with no change (I’d know, I was on the committees). That’s very similar to what’s proposed here, except that the committee will be appointed by the Community Governance Panel instead of directly by the Board. But hey, we’re already trusting the CGP to appoint the Board… So formalizing this process, as proposed, looks fine to me.


@dontbeevil, any chance you can recreate the poll with an “I’m fine with either” option? That would be my pick…


Well, I actually think we can learn a bit from the fact that the ‘keep it simple’ proposal was so popular. First of all I think it reflects that the community has high confidence in the ability of the ECC and Foundation to continue doing a good job. Second, I think that it reflects a desire to do just what it says, ‘keep it simple’, for this reason I think we should hesitate to add any more complexity to your proposal, (which I have always thought was excellent and am not surprised was the community’s top choice :slight_smile: ). If the community doesn’t like complex proposals and they have signaled high confidence in both the Foundation and the ECC, that to me would definitely would signal that we should leave the Foundation in charge of major grants as already specified in your proposal, and not make totally new entity to decide the major grants.

I thought that the Major grants were supposed to explicitly favor organizations other than the ECC?

I am not suggesting major changes to your proposal. I just think that since funding may be tight for the ECC, the organization that has done most of the R&D for zcash so far, and the top two proposals have significantly different funding amounts for the ECC, that we should try to gauge the community’s preferences for specific funding percentages. One idea is to vote on alternative funding percentages, such as for example ECC 45%, Major Grants 35%, and Foundation 20%? This would provide more funding for the ECC while still giving the Foundation control over a majority of the Dev Fund.


Looks like i can’t change the poll now. Is it worth adding that option now?

Is it worth adding that option now?

I think so, yes. Otherwise I don’t know what to vote… And it would be a shame for the poll to indicate contentiousness where there is none.


You can just delete and make a new one, only 2 people have voted and I was one of those two :slight_smile:

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