Historically: I picked $700k/month in my draft ZIP 1012 because ECC’s expenses have been floating around $700k/month for a long time according to the transparency reports, so this seemed like the natural choice for ECC’s side of the “maintain the existing teams and capabilities in the Zcash ecosystem” goal. Especially when ECC’s plans for growth can be accommodated by Major Grants and/or the Funding Target adjustment mechanism.
why are the caps $700k/month for all slices, rather than being in proportion to the percentages in each slice?
Historically: My first version version of draft ZIP 1012 had 3 equal slices, so setting the Funding Target of each slice to $700k/month was proportional. When I made the last-minute to the slice percentages (35% ECC, 25% ZF-GU, 40% ZF-MG) to harmonize with Matt Luongo’s proposal, I left the $700k/month unchanged. You’re right that an alternative would be to make the Funding Target be proportional to the coin percentages, i.e., have identical ZECUSD threshold at which extra ZEC goes to the Volatility Reserve. This would not substantially affect ECC, but it would change how much funds are available for operational use by ZF-GU vs. ZF-MG slices at at high coin prices. It would also be a bit slightly more complex to specify and understand. I don’t think it matters much, and I don’t object to changing it.
I stress the historically because these were the judgment calls of one person, informed by his imperfect and possibly outdated understanding of community sentiments. So it would be very reasonable to adjust these.
I agree that the “new” here is bad. My mistake. It’s inconsistent with the explicit goal of this ZIP to “maintain the existing teams and capabilities”, and to the extent that it applies to ECC, it’s redundant with criteria 3 of Major Grants.
I addressed this, and some other clarifications, in the Clarify Major Grant criteria #2 proposed changes (pull request) which I submitted now.
Update: ZF has merged these changes into its draft ZIP 1014.
Would’ve been great to discuss this before sentiment collection, no? Not that it’s not worthwhile at any time, but concretely what are you proposing – another cap-related poll question?
What do you think, how many employees should be in the state and what average salary should they have? How much additional expenses are needed per month, just when they say that 700 thousand is not enough I have a question “why not enough?” it is a lot of money in the real world, where production works and there is a real economy. Of course, any company wants to get billions, but is it real? From open data, the salary of a doctor in the USA is 300 thousand a year (on average), considering that there are 10 people in the ECC staff, on average 70 thousand a month or 840 a year is obtained, that is, if you are equal with doctors, you can have 30 employees -average.This is an example for illustration, maybe someone has the same questions.
A company that provides services to a project that has not received distribution I think can’t say that this is not enough, let’s better divide the percentage of the amount at a price of zec 1500 dollars per coin, and then I think everyone will have enough (you can say that this will not happen, but I can say that it necessary to continue work- total fair value for the product in the project)
You can not sell the product below cost.
But the community voted for another proposal, also ECC has the opportunity to release a fork of zcash with its vision, zcash 2.0.
And I agree that the ECC still has not agreed to work on the current proposal, and changing it under the ECC is not entirely correct, because another developer may also be dissatisfied with the conditions, what was the point then in voting if you need to repeat at any outcome voting, and so on, until the right option is adopted, so-so democracy.
I said from the very beginning that the ECC needs to draw up its proposal and put it to the vote, and then the community would have voted for this particular developer or just for the proposal they liked, and now when the vote has ended, the ECC is just pushing its wishes, although before that it was said that to intervene will not. Like this! As I saw the situation from the position of the fund- After the state will be signed a contract in the amount of zcash for a certain period, and the development team will execute it regardless of the price of zcash, as this is the task of the developer. And what we get, we get what the central government is, and what it says it will be, the voting was not just not necessary, it did harm (will do) when everyone understands what they have come to.
I have asked about x times about 7 months ago that the ECC clearly states what they need for what and/or come up with an own proposal. The reason behind that is that way proposal makers have exact numbers they can work with.
An ECC proposal was clearly refused with the argument that the community has to make a proposal and the only numbers available for proposal makers are the ones that figure in the transparency reports which are around or below 700k US$.
There are a number of proposals which have no 700k cap, but these unfortunatly for the ECC didn’t get the majority of votes. I personally think that the community decided that these 700k funding is enough to keep the ECC operational, as it’s today and the whole last 2019 year.
Now if the ECC wants/wanted more a wishlist approving than a community voting/decision than we could have spared us all the whole voting process and proposal making.
I’am not sure i understand this completyl. I mean right now the ECC has to work with 500-600k funds monthly, so having 700k funds available should even improve things a bit.
Beside that, in my opinion ( i could be totally wrong here!) i think the ECC made a strategical mistake by not accepting and not going to convert to a non-profit company but keeps the for-profit status. I could bet that with a non-profit status the community would have been more willing to allocate more funds to the ECC, but that’s of course just my personal impression.
The more the proposal gets changed, the less it has anything in common with the proposal the community voted for.
This discussion now makes me think that there is maybe a missing part in the proposal that should be adressed. Maybe adding a point what happens if the ECC decides NOT to accept the job or withdraws at some time and how the ECC funds are allocated than.
@tromer, would it make sense to have such case included? I mean we have that case that IF there is nobody applying for the major grant funds that the ECC meanwhile can use them. The same way it would make sense to have the an reserve/emergency option with the ECC funds in case they opt-out or whatever. For example 1/2 goes directly to the ZF and 1/2 to the Major grants? Or 3/4 to ZF and 1/4 to the Major Grants?
That’s an oversimplification. We obviously didn’t completely “opt out of the conversation”, and ECC has made several statements that bear on this issue.
The transparency reports were always clear that they referred to the amounts that had been spent in a given period, not the amounts needed for sustainable operations. As I’ve said, in my opinion ECC is currently severely understaffed. Partly that’s due to difficulty in recruiting the right people, but partly it’s a matter of money. (This is my understanding, not an official ECC statement.)
As far as I know, ECC does not object to needing to apply for Major Grants in order to get more than a 35% slice. Putting the USD cap aside, my concerns above were about whether it will be able to do so on a reasonably level playing field with other applicants. @tromer has filed a PR against ZF’s draft ZIP to change the wording slightly, which I approve of as far as it goes.
Maybe my thought is in bad English, but what i have in mind is: What happened with the funds/slice for the ECC and IF the ECC decides it does not or can not work further on Zcash or for whatever reason decides to stop working on Zcash.
For such case there must/should be a mechanism that accolcates the ECC slice/funds elsewhere to people willing to work further on Zcash, be it towards the ZF or Major Grants or shared somehow.
IF i didn’t miss something i think such mechanism and wording is currently missing.
I think it’s literally the same like the major grants wording/mechanism. IF there is nobody that applies for the major grants the ECC could take it or parts of it.
In short, there should be a mechanism that allows the ZF and/or the major grants to take the ECC slice/funds in case the ECC stops working on Zcash at a given time for whatever reason.
Hey folks, I’m holding off on posting in this thread during the holidays, in part to be respectful of other people’s holidays. Looking forward to catching up with you all in the New Year!
Time to resume the conversation. After much thought, I’m leaning towards no USD caps. It’s a dilemma. Choose b/n:
Provide elasticity so ECC hire better and attract top notch. There is so much money being offered for these talent because of the value they are creating.
Put a limit on how much ECC can spend a month.
Good thing is this funding is not forever. Community can see how much reserve is left for development after 4 years, how much value is created, how much improvement seen in zcash and decide to fund ECC and/or other teams/ZF.
IMHO, choosing 1 is better than 2. We can just do the voting, so I don’t see a point arguing about it anymore.
Hey Ric, thank you very much for contributing some thoughts based on your experience.
The following is my personal opinion — not speaking for the Electric Coin Company.
I agree with you that a vesting schedule is a key part of the successful Silicon Valley model. I think what we’re starting to see after ten years of the cybercoin industry is that the simpler model, that various cybercoins have tried, isn’t good for long-term, sustainable, incentive-aligned operations.
The case you cite — that the majority of the Ethereum founders, who received funds from the Ethereum ICO, are working on Ethereum-competitors, or unrelated things, or retiring, instead of continuing to contribute to Ethereum — is one example, and there are many more cases like that throughout the industry.
I think people should scrutinize all such structures and review how funds were used over the years — not to judge other people’s choices, but to learn what works.
Based on the current results from the Zcash community governance process (1, 2, 3), this community is poised to create a structure that is simple and decentralized, that encourages open source and independent contributors, and that works.
As I wrote in an earlier thread:
The part about deferring the upside for years, and the part about making each person’s share contingent on their own performance, was missing from a lot of cybercoin funding structures. I think this is the biggest piece of what we mean when we talk about “accountability”.
ACCOUNTABILITY
Now, how can we as the Zcash community apply this idea of a vesting schedule? How can a decentralized community enforce accountability on the recipients of its dev fund?
There is no obvious way to encode such a mechanism into consensus rules. I suspect that any attempt to encode such a mechanism into the consensus rules would turn out to be impossible, or else very complicated, with major unintended consequences. Maybe the various DAO experiments that are being tried will show a path for this that we can consider using in a few years from now. (But most of them will probably show us all how not to do it — by crashing and burning.)
But, I think the best answer is already contained within Mario’s comment on this thread! Which is: the community has the inalienable power to revisit the consensus rules in the future and change them as necessary in order to enforce accountability. This is not a choice, it’s just a basic fact, that the community has the power to change the consensus rules. There’s no way anybody could prevent the community from having that power.
If you give someone 1,000,000 coins up front, you run the serious risk that they’ll take the coins and give you nothing back, or give you not enough back, over the years. This isn’t because they are bad people, this is just the nature of how the world works. You can’t realistically ask people to spend years of their life prioritising something unless there is some ongoing positive consequence to them for doing so. This is what Ric is claiming (above) didn’t happen with a lot of the Ethereum founders.
If you say to someone “We’ll give you 20,000 coins a month for the next 48 months.”, then they should be more incentivised to focus their attention and their efforts on things that align with all the other coin-holders. At the very least, they cannot just dump their million coins up front and retire, until 48 months later. However, experience shows that you still run the risk that at least some of them will passively receive the coins every month for four years and do little or nothing to help.
But if you say to someone “We’ll give you 20,000 coins a month for the next 48 months, but we’re going to meet again in a year to review your performance, and if we think it would be better for us to replace you with someone else at that time, then we’re going to cease giving you those coins and put someone else in that role.”.
Well, that’s different! As long as what you’ve said is credible (i.e. they believe that you’re really going to do that), then you can bet that they are going to prioritise your interests and values and work hard to continue to earn your trust.
To summarize, Ric is pointing to a serious structural issue that a lot of the coin projects over the last decade have encountered, and Mario is pointing to a solution to it. This is the way that a decentralized community can hold the recipients of its dev fund accountable.
Hello, friends! We’ve been talking with the Foundation, and we thought it necessary to clarify our position in advance of the next round of polling.
The Electric Coin Company plans to decline to accept the funds if it comes with a fiat-denominated funding cap. This is because — as we explained in our recent blog post — we will accept money to take on a role only if we believe we can succeed at it, long-term. We believe the deep incentive-alignment from a ZEC-denominated funding stream is necessary to succeed at that role. We’ve considered some of the proposed solutions that have been brought up and we do not think they are tenable.
This raises a question that I think the community needs to align on before finalizing the ballot for the next round of polling, which is: if the polling were to show that a fiat-denominated cap were required by the community, then what would the community do with the slice that it had intended to allocate to ECC? Would that slice then go to the Zcash Foundation, or what? I think people need to have an understanding of what would happen in that case before we go to the next round of polling, so that they know what they’re voting on.
Aside from that issue, we do not see any other blocker issues on Draft ZIP 1014 or the Foundation’s most recent proposed ballot questions. If the community offered us that role without the fiat-denominated cap, we currently see no reason why we couldn’t accept.
Note that we have a couple of more issues with the current Draft ZIP 1014 and the current proposed ballot. They aren’t blockers for ECC taking the role, but they are things that we think the community should talk about and potentially amend the draft ZIP text before the next round of polling. I’m working on a follow-up post about that.
Looking forward to catching up with you all in the New Year!