Dev Fund Proposal: Increasing Monetary base by 10%

Dev Fund Proposal: Increasing Monetary base by 10%

Advocate: boxalex

This is a so far unique approach on finding another way how to garantee funding for the ECC & ZF as i’am not aware another proposal suggests increasing the monetary base by a given amount.

Main Goal:
By increasing the monetary base of Zcash from 21M by 10% the monetary base would result in a total of 23.1M ZEC.These additional 2.1M ZEC would be used for founding the ECC and ZF.

Secondary Goals:

  • increasing the monetary base by 10% would equally spread the founding to all groups involved and not a single group like suggested in most other proposals, the miners. Increasing the montary base would effect holders, investors, miners, even the ECC and foundation themself.
  • It would be in my opinion less risky than giving miners various options to opt-out, burn or even give them more influence eventually.
  • It would result in a more predictable situation. With opt-in/opt-out we still have no idea if the miner will choose all to burn for example which again will leave the ECC/ZF without any funds at all. Allocating a fixed number of ZEC will at least give a certainity how much funds will be available for a given period.

Funding Timeframe:
This proposal suggests securing the funding to result in having enough funds for the ECC and ZF to operate for 8 years. IF the funds are not enough the ECC/foundation have to make internal adjustments and economics to fit the funding available. This is not fixed at all, if logic arguments can be provided it could be as well 5, 6, 7, 9 or 10 years.

Funding Mechanism:
I’am not yet sure what the best way would be to release 2.1M additionally ZEC and there are several options for discussions and maybe even some other options that could be suggested by the community. With all options suggested it should be of highest importance not to increase the anyway high inflation rate or at least only minimally increase it.

Option 1: Lend Lease from miners
The ECC and ZF leases blockrewards from the miners that lend them to the ECC and ZF. In a later period, beyond the Funding Timeframe, for now 8 years, the additonally monetary base gets released delayed and available for mining after the year 2028 (if the 8 year funding timespan is kept).
Advanages in my opinion:

  • The biggest inflation rates in the next 8 years would not be effected but would spread on anyay way longer inflation rates coming after year 2028.
  • The miners would only lend temporary part of the block rewards to the ECC and ZF but at a later time get them back from the increased monetary base.
  • It would keep the promise that finally 90% of the minted/mined ZEC goes to miners as promised in exchange for breaking the promise of 21M coins. In my opinion this is a better trade-off as someone could argue that anyway a portion of the 21M coins won’t be accessable anyway, be it due lost coins, lost private keys, whatever. Means in theory the broken promise could have less impact than the broken promise of 90% to miners which of course are active.

Option 2: Superblocks
Due easyness for understanding i’am referring here to a date and not block number a given Superblock is mined for example every 15th of the month. This would need more calculation as another halving in 2024 would have to be taking into account. But the idea is that with every superblock the according part of the additionally 2.1M to be released ZEC gets into circulation at that given day and be available for funding of the ECC and ZF.

Option 3: “Airdrop” or "Premine"
Another option would be an Airdrop or Premine of the whole 2.1M in advance but only to be partially released at a given date, let’s take again every 15th of the month for example to keep it simple at that stage: Means, while the whole amount of 2.1M is practically allready mined the according only 1/96 of this amount gets release monthly. Or even more simple: Every 15th of the month 21.875 ZEC get released and are available for usage until after 96 months the last part of this amount is paid and the whole 2.1M ZEC are released and brought into circulation. This option would hurt the inflation rate most in my opinion as from the beginning the 2.1M ZEC would be in circulation even they are not usable at all.

My personal opinion is that the Lend & Lease approach in option 1 would be the most gentle to inflation rate adding the least inflation pressure.

Fund Splitting:

  • Preferable 50% to ECC, 50% to ZF, integrated into the protocol up to what option is choosen.
  • New split of 40% ECC, 40% to ZF, 20% to a common fund or maybe 45%/45%/10%

Idea of a common fund:
A common fund could be used for researches or work that IF not funded by a common fund both the ECC and ZF are doing overlapping work. For example the ZF would grant or finance or work on a mobile wallet with x features. The ECC at the same time could work as well on such mobile wallet using it’s own funds. It would be a waste of resources not to have both researches & work involved bundled. In such case a common fund could be a good source to finance efficient such matters instead of having resources wasted on seperate work which leads to the same outcome.

Unknowns:

  • I’am not sure how this could/work out for the ZF as a 501c3 foundation and the charitable funding character that is needed. This requires further research and what circumstances such a funding model would and could fit the ZF requirements and it’s status.

Further Requirements:

  • The ECC should change to a non-profit status to become a recepient of this proposal.
  • The ECC and ZF should increase further even beyound the non-profit and by law status for transparency, openess and accountability voluntary
  • The ECC and ZF should release every 3 months a transparency report on how much, for what when the funding was used or not used.

Additonally requirements: New Governance Panel
A new enhanced Governance Panel should replace the current Foundation’s Governance Panel:
This is just an idea below to show how a better, more fair goverance panel could look like:

  • ECC, 10 member
  • ZF, 10 member
  • Zcash Founding Scientists, 7 members IF not employed/paid at/by ZF or ECC allready.
  • Mining pools, biggest 10 mining pools each 1 member, results in 10 members
  • Hardware producers, Innosilicon & Bitmain: Each 3 or 5 members, results in 6-10 members
  • Investors like placeholder, blocktown, grayscale and such, each 1 or 2 members, results in “unclear”.
  • Zcash community: Every forum member registered on the official Zcash forum for at least 3 months? Eventually a minimal post count or other restriction could be added to avoid people joining just for voting reasons, results in unlimited unclear members.

Other possibilities to include"

  • Zcash affilated or Zcash supporting projects like parity, wallet creators, such like, 1 member each.
  • pretty sure i forgot some groups, this of course can be included as well.

The reasoning behind such design would be that indeed every arm of the Zcash community would be represented, would have a voice and even a vote and can influence important decisions that have to be made.
So far everybody is talking about community decisions but nobody is even near a plan on how this could be done fair, promising and working and accessable to literally everybody interested. Here at least a solution that tries to include all the different streams of the Zcash network.

Edit: Just thought that the more “normal community members” join the less influence the ZF, ECC, investors and so on would have.

I think a possible solution would be that the fixed members for a given organization should be per 100 people that vote. Means if the new governance community panel gets for example 200 members the members or vote count of the fixed members should be double to garantee a fair voting power distribution.

In my example this would mean that the 10 ECC members would have/get double the voting power resulting in 20 votes at the point the community panel reaches 200 members. Just as an example as there must be a mechanism that the bigger the community governance panel gets the influence of the must members like ZF, ECC doesn’t get inflationed.

Voting, Polling, Results:

  • Every member of the new governance panel gets invited to take take part in the discussion around a given proposals, changes, whatever and of course later a vote in the governance panel.
    A voting must result in a suggested 75% majority to be accepted, maybe 66% could be an alternative level as well. Up to community discussion what the best level in % would be to replace a wider community agreement.

Voting/Polling by the New community governance panel should be seen as binding even if not ultimatly and not like now just some polling. Eventually some pure highly technical aspects should not be taking into the new community governance panel, that’s up to further fine adjustment on what would qualify to be decided by the new community governance panel.

This proposal is of course up to further discussion, improvement, fine-tuning, adjustments, whatever, enough there is a wish by the community to do so.

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@Sonya

can you please include this proposal to the other active proposal’s list. Thx in advance :slight_smile:

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added:

Just thought that the more “normal community members” join the less influence the ZF, ECC, investors and so on would have.

I think a possible solution would be that the fixed members for a given organization should be per 100 people that vote. Means if the new governance community panel gets for example 200 members the members or vote count of the fixed members should be double to garantee a fair voting power distribution.

In my example this would mean that the 10 ECC members would have/get double the voting power resulting in 20 votes at the point the community panel reaches 200 members. Just as an example as there must be a mechanism that the bigger the community governance panel gets the influence of the must members like ZF, ECC doesn’t get inflationed.

IMO the inflation schedule and 21M cap is the much more strongly expressed promise. Based on the outcome of the last pow change debate, and what other cryptocurrencies have done, “No sudden changes to mining parameters” is, I think, the appropriate promise to make to miners, so that they have fair warning to make informed choices on their rig investments.

When a ballot about “being open” to proposals on changing the supply was included in the governance panel last year, it was pretty nearly a tie 31-33 against, so maybe it could be in scope. https://www.zfnd.org/blog/governance-results/

Despite there being a strong promise against it so far, in my opinion “dilution” should ideally be considered a valid move that coin holders could decide to do. I think this is an unpopular opinion tho generally.

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That’s an argument and that’s why it took me so long to come up with an option that only would minimal influence inflation rates with the lend & lease option and that the additionally 2.1M get added and brought into circulation soonest in 8 years. This would be an argument in my opinion the the inflation schedule is not influenced further in critical times but at times where the supply is anyway a way lower.

I understand your argumentation here, but in my book a promise is a promise at the end of the day and a broken promise is a broken promise.

Someone could even argue if it’s a more strongly expressed promise as everywhere you encounter officially 21M cap and 90% to miners it’s mentioned in one sentence. But that’s not the point anyway in my opinion.

I’am not yet sure if the burning option wouldn’t lead as well to an intervention in the monetary base. In your latest statement about how burning would be done i got the impression that burning would mean that they just don’t get minted which leads me to the conclusion that it’s either:
a.) they don’t get minted and are not part of the 21M, would result in less minted ZEC than the 21M promise.
b.) they do not get minted at that very point but it’s possible to mint them at a later point. Abstract and i don’t think that is what you have in mind or would be a result, but mentioning it here.
c.) the to be burned coins would get minted but immediatly destroyed bevor getting into circulation. In this case again the 21M promise would be compromised as never 21M get into circulation as promised.

I have answered this in another topic that this is very unpredictable as it’s up to energy costs someone has access too. But never mind anway. In this proposal the effect for the miner would be temporary the same as with any other opt-in/opt-out, the only difference would be that with the lend & lease option they would temporary fund for the time beeing in place and later compensated with an additionally to mine amount of 2.1M ZEC which they have lend to the ECC/ZF meanwhile.

Just my personal opinion, but i think the lend & lease option is a much fairer option towards the miner, but i agree there might be different views on this, especially as we do not yet know how exactly opt-in/opt-out and burning is definated.

But adding another point to the danger of opt-in/opt-out. What happens IF NO miner chooses the funding option but everybody burns? How much funds would this give to the ECC/ZF??

Actually that’s one of the things i more or less counted with this proposal, i just don’t wanted to make such increase monetary proposal bevor i have a solution for “don’t increase inflation” problem ready which resulted in the lend & lease option and 2nd i had to wait for the guidelines of the ZF and ECC and exactly the 31-33 result let me believe that there is place for such an option and alternative funding proposal to competete with all others that are based more or less just on direct miner rewards.

I absolutly agree with your conclusion. But i think we as well, as a community, we should have in mind, that proposals are often prefered by these that at the end don’t have to pay for these.
For example i await hard resistance from the VC proposal makers here, because it’s naturally in their favour that someone else pays for it, the miners for example.

As said, i absolutly agree that this proposal is on first view an unpopular one, especially for these that allready have a lot of influence and a bigger stake, but hopefully the lend & lease option as well as fairness makes this a valid alternative proposal for funding.

Thx for your input and feedback :slight_smile:

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This is crazy talk!

Foundation are ok with inflating money supply?

Personally, I am absolutely not okay with inflating the supply. I will vehemently oppose any and all ZIPs that suggest it, and I will quit Zcash as a project if the 21M supply cap is ever raised. I decided that a long time ago and I haven’t changed my mind.

That said, my personal views aren’t the litmus test for whether a proposal can be introduced and discussed. @boxalex I added a link to the lists!

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as one if the people that voted on this -


“monetary policy/supply schedule”
people did complain about the way it was asked. i’m okay with discussions on changing (slowing) supply schedule, not okay with changing total supply. trust me, vote would look much different if question asked was “are you okay with increasing total supply”.

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This should be a RED LINE for Foundation.

Can Foundation confirm they are 100% against changing monetary base?

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I really honor your views, thoughts and straightness, but i’am not sure if i’am ok with this, for several reasons.

First of all this sets a pretty bad example, what’s next? Zooko, Josh, the whole ECC company coming along and saying that every proposal that doesn’t fit their wishes they are going to quiet Zcash?

Second, this could seen as sabotage bevor even a discussing about it has begun. It’s quiete a bummer if someone from the foundation (or ECC) directly expresses such action and interferes allready in the stage of discussion. This puts oil into the fire where allready a lot of people think and suspect that no proposal even has a chance if it’s not a 20% direct from blockreward one. There are even bets on this that this will be the outcome and i’am not hidding that i’am one of these.

This sounds like, you are free to waste your time but you won’t get anywhere.
Ok, not that you aren’t aware with the my proposal history but let me fit it up in some sentences:

  • My first proposal had to be withdrawn because it was made clear that the foundation would not support any proposal which sets them as the only recepient. Ok.
  • My seconds proposal, opt in only, sits for weeks and months now, without being important questions answered.
  • My third proposal, this one, gets a frontal torpedos from you hours after i wrote i released it.

I get your point, but you should as well think how this looks like. On one side we hear all the time community should choose, community should decide, community should make propsoals and so on, and than, if the proposals doesn’t fit 200% the foundations or ECC’s vision, nothing. I suggest the foundation and ECC just make 2 proposals, each one and than you can endless discuss and vote and veto these as this is anyway the outcome, just without some statists like me and some others.

As well, interesting how every other promise can be broken forth and back but not this one even on the softest variant.

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Possible, but no garantee either. As well than back many votes would have be different including the asics one from the point of view today.
Actually if than back the question was asked if the foundation should be op for changes in monetary policy for further funding i’am as well pretty sure the outcome could have been different.

Today we have a different situation, it’s about funding, not just out of fun changing something.

How do you think if than back a voting would have been with a question like: Should the foundation been open for extending a dev/founders reward? Or should the 90% to miners promise be broken? I doubt these questions would have gotten ANY support, even not close to the change monetary one.

But times obviously change and breaking a promise doesn’t seem a problem anymore after the asic promise was broken, or better not hold nor after everybody is betting on the break the 90% to miners promise.

The much you want it to be a red line, i doubt it’s anymore a red line, even in less in future.
Sure, they can announce it’s a red line, for now, but things will change some day.
These opt-in/opt-out burn proposals which mostly will make it won’t be good ones in practice.

Latest if we see that only 0-20% of the miners opt-in/opt-out and burn their coins the foundation and ECC left with some peanuts will be the first that regret refusing the soft increase of monetary base.

Bookmark this post and check back in some years, My prediction/speculation for soon or late: Either the monetary base gets changed some day or there will be a converstation like 1 old ZEC = 10 or 100 new ZEC or something like that. I’am willing to take any bet on this with a time line of 10 years.

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It’s pretty clearly already a red line, it was mentioned as such in Josh’s May post,

reiterated with underlining in the guidance post,
“the total supply of ZEC would continue to never exceed 21 million” https://www.zfnd.org/blog/dev-fund-guidance-and-timeline/
and multiple foundation members have already made it clear they consider it a matter of personal necessity to uphold. So… this aspect of the social promise is pretty clearly alive and well. I’m symbolically downvoting it by not pounding the :heart: despite the post being well written and having useful arguments in it.

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There are not words for how opposed I am to this, I will dump every coin I own if anyone touches that total coin count.

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Like @amiller said, the Foundation is sticking to previously stated principles. The Zcash Foundation, officially, continues to oppose inflating Zcash, as we have from the start.

To be clear, my personal views are separate from the Zcash Foundation’s official stances, but I happen to strongly agree in this case.

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I knew you were going to do this. I hate you for it. I love t1Xcho!

btw you realise if they do this craziness you lose the bet right? or is this the mutual assured destruction option and we both win?

EDIT: having read the thread, why is everyone getting so upset? it is the same as changing the emission curve, it is the same as double taxing miners. it is the same as changing any of the pillars of the algo. - don’t get me wrong the idea is exceptional, but that is also how people are reacting to it.

How you feel now is exactly how I feel every time someone talks about taking block distribution away from miners.

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now we’re at a point where people that don’t own zcash are proposing increasing total supply. my goodness, what a world.

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You can propose anything at this point — any ideas are up for discussion, for support or dissent. But changing the Zcash protocol requires going through the ZIP process, which is governed by ZIP editors who represent ZF and ECC. So those organizations’ positions are pretty relevant.

As for my personal opinion, I want to make sure that I fully understand — are you worried that I’ll dissuade others from commenting? I don’t have the authority to torpedo an idea, but you’re concerned that people might think I do?

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Now we are at a world where people who don’t mine zcash are proposing to tax them twice.

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don’t care, can go mine something else if they don’t like it.