Founders should only receive 10% of the first halving and beyond

[trolloniex]

20% of 2 Billion = 400mill of total as stated above

[maxi]

lol. Yes, you are right. Jumped the gun on this one.

[zooko]

Yes, the Zcash Company is a for-profit company, and it will be focused on increasing value to its shareholders. The Zcash Foundation is a non-profit, which will have a mandate to protect and improve the Zcash protocol for all users.

Now, obviously most things that benefit users also benefit the Zcash Company in some ways! So there is good incentive alignment already between the Company and the broader ecosystem, however that alignment is not perfect.

You asked for an example of something that would benefit the Company but not be in the interests of all users. The first example that comes to mind is that the Zcash Company could get into the business of selling enterprise software to banks. They certainly are extremely interested in the technology, so we’re in a good position if we want to start selling a product based on that technology to them. This could be really valuable to the shareholders in the company.

It wouldn’t necessarily bring a lot of benefit to the users of the open blockchain. Although it might, if we could use the revenue from the enterprise side to build better and better technology that we also open source and everyone can benefit from using it.

But, whether or not that strategy would result in better or worse results for the open community in the long run, it is a valid strategy that the Company could consider taking if it needs the money.

It would not be a valid strategy for the Foundation, which should not do things that come with a risk of potentially not helping the users, or that require non-transparency, or that increase incentive misalignment between the Foundation and the users.

[str4d]

@maxi

The final total is 20% of the supply no 10%.

That’s a misunderstanding. The final FR percentage of the total monetary supply (21M ZEC) is 10%, thus the FR total market cap would be 200M based on the current futures rate.

[abromide]

@maxi @trolloniex

The Founder’s Reward is only 20% of coins before the first halving. (20% of 10.5m coins = 2.1m coins). After the first halving, founder don’t receive any further coins out of the remaining 10.5m. So, they get 2.1m coins in 4 years, which translates to 10% of ALL coins produced over all of the years. At $95 a coin that’s roughly $200 million.

[abromide]

@zooko

Thanks for the transparent and interesting bank example. I’ve been very impressed with the uptick in transparency with the release so close I think we are all very interested to see what the non-profit can do for the community, and would love to see some integration of the outside world into zcash (such as financial institutions).

[mistfpga]

@abromide

If there truly is to be an incentive to continue the development of Zcash, why should all of the incentive be used within the first four years? Development will surely need to be continued beyond four years, unless of course the plan is to play the short game, which leads me into my second point.

This seems as oddly relevant today as it did 3 years ago.

I like this phrasing too.

@trolloniex

I would also like to add that “they” in layman terms get 20% of the hashrate 100% of the time (in theory). The higher the hashrate gets the higher mining costs will be, the harder it will be to be profitable if at all

This whole discussion feels so familiar.

@5a1t

Would the coin be 20% worse off without the full team they have working full time? Almost certainly so.

I can see why this whole debate for the 2nd time around has “got to” some of the battle scarred of the first round.

Sure it was a different argument going on back then, but jeez it would be cool if some of these people were still around.

This is interesting… Why didn’t the ECC go down this path?

@zooko

You asked for an example of something that would benefit the Company but not be in the interests of all users. The first example that comes to mind is that the Zcash Company could get into the business of selling enterprise software to banks. They certainly are extremely interested in the technology, so we’re in a good position if we want to start selling a product based on that technology to them. This could be really valuable to the shareholders in the company.

It wouldn’t necessarily bring a lot of benefit to the users of the open blockchain. Although it might , if we could use the revenue from the enterprise side to build better and better technology that we also open source and everyone can benefit from using it.

But, whether or not that strategy would result in better or worse results for the open community in the long run, it is a valid strategy that the Company could consider taking if it needs the money.

[I made the text bold not zooko] - Seems pretty different than to todays attitude.

@abromide

The Founder’s Reward is only 20% of coins before the first halving. (20% of 10.5m coins = 2.1m coins). After the first halving, founder don’t receive any further coins out of the remaining 10.5m. So, they get 2.1m coins in 4 years, which translates to 10% of ALL coins produced over all of the years. At $95 a coin that’s roughly $200 million.

@boxalex beaten to the punch 3 years ago…