That’s a valid concern in my opinion, but if we begin to talk about power it should have a discussion & solution into all directions.
For example we can use the very same argument in why the ECC needs that much power after they express their wishes allready in the protocol itself and bevor that internally in ECC discussions behind more or less closed doors? Why for example should they say have another say/voting/decision in the foundations community governance panel for example?
Don’t get me wrong, i’am all for power reducing where too much power is hold, but than it should be made all together into all directions that seem to have allready a lot or too much power.
By ‘power’ I was specifically meaning ‘the ability of miners to unilaterally divert funds’ - its unnecessary if all we want is their input.
There was a request to miners on the stakeholder vote that they select what they want using the coinbase text for a range of blocks. Cant think of a reason why the same mechanism couldnt be used for this.
Think mining has been around so long we consider miners to be the ‘hammer’ and every issue to be a ‘nail’. On the livestream daira summed it up nicely, ‘their job is just to get txns into blocks’.
I can’t see another way how it else could be a (charitable) donation if they don’t have the power to decide what to do with it. This is not limited to miners by the way, wherever especially the foundation gets its funding from has to be affilated with a free of doing so decision.
At the very least we do a normal style vote similar to the Foundation Board vote system to determine recipients and %'s and then do that every couple of months, that gives everybody say and not just the miner, coincides with existing upgrade schedules
Some argue that it wasn’t the best set up but if we were doing it more often maybe we could work out those problems
(As far as signaling goes I mean, I think everybody doing it once every 90 days vs 1 (in like 7 or 8 realistically) person every current 2 and 1/2 minutes)
Absolutely - the multisig arrangement sonya suggested delivers that.
It ensures funds are not controlled by any organisation, they’re stored so they can only be released with the agreement of many participants - and all of the participants are commited to doing that ‘the right way’.
Or in other words, ZFnd/ECC/etc… are not receiving money, they only have a voice (one of many) as to how its spent or burnt and a set of rules they must follow.
Add to that the ‘transparancy & accountablility’ that ZFnd (and ECC) are striving for, plus the focus on governance & responding to community sentiment that’s been expressed here and we’re getting close to something good.
What I like most is that it establishes a mechanism for continued funding (ie: tech stuff) and moves the whole issue towards governance.
Must agree, but if the opinion is not correct?
I believe that the classic model with representatives (major miners, coin holders, regulators or consultants) who choose a strategy, methods and methods works easier and more efficiently, but then the fund needs to reconsider its position of non-participation, otherwise we don’t have investors, we get everything voluntarily , we can do what we want because we are not responsible for anything (or rather, we want to answer but are not obliged).
I still don’t understand how the organization can be in such a role, but oh well, it would be better if the experts would do their job and achieve results.
And support should be open, but wrote about it above.
Everything needs to be presented to the public.
Objectives: to create Internet money with the maximum distribution on the exchanges, to agree with regulators.
Ways to achieve: financing (we have an asset, we sell it, buy at your own risk), direct sponsorship or income from other places.
All that they say now is that the price is not important to them, and most importantly, acceptance by society cannot help them achieve a result, such a statement is possible when adoption has already passed and the coin has reached the goal, and there are enough small funds that can be obtained from the sale to support it.
I will wait for a discussion of fund financing models, what will happen to those that do not suit them initially.
Yes, that translates to an average $200,000 salary. Given the market rate for high-end tech talent in the United States — which is, unfortunately, the deepest talent pool for us — personally, I think it’s quite reasonable.
On the other hand, prospective budget might include the cost of benefits — healthcare, providing a 401k, etc. @acityinohio, can you speak to that?
Yes it includes estimating benefits/wage taxes as well (which typically hover around 25-30% the cost of base salary) making the average salary closer to $150-160k.
I think that’s not going to work under any financial system i’am aware of and least with the US one where charitable foundation funding falls under strong control and requirements.
To begin with. There is no such thing as sending money to “noman’s land”. If a blockreward is sent somewhere for a dev fund, no matter if voluntary or mandatory there is a beneficary account. This account must hold 1 name for tax purpose. In my opinion there is no chance to hold money in an account with several different entities that are taxed in different ways. I doubt this has happened bevor, if it did i would like to see an example of such setup and tax design and how it’s threatened tax wise.
Next one that comes into my mind is as soon as it is not directly from donor to foundation it’s no more a charitable donation or donation at all, the only chance here would be that the account holder and first beneficary is the foundation itself and than releases fund to the ECC. Reverse it won’t work having the ECC the beneficary and releasing to the foundation won’t work. I can’t think of any other legal construction this might work, maybe i miss some important part?!
And the least but not last thing would be the legal aspect for the foundation in general for that funding type and mechanism. I personally allready have doubts the current mandatory funding with a touch of opt-in/opt-out might be fully legal, not even talking if another mechanism is build in that complicates things even more to follow the path donor to foundation from the IRS point of view.
Than the aspect that a 3rd party (ECC) has a say on foundation donations/funds? I doubt this is law confirm. All sounds good with many participants agree/release/fund/whatever, but i think that here the bill is made without counting in the IRS view.
this drama gets more and more interesting. imho, afair, its the most interesting crypto governance drama since new york agreement with btc/bch split. if all interested parties, despite all fud, will not make not-well-weighted or even rage decisions/declarations during discussion period and will finally elaborate final acceplable solution, this will have big impact not only on more confident and positive future of zcash, but also on major part of legit cryptosphere. approval of continuation of dev fund, in any form, will give a big test to one of most popular narratives in crypto: its good to be freerider, we always win (until not).
Maybe i didn’t explain it the best way. I’am well aware that we both for example, a foundation alone can make a multi-sig account at any bank. The same of course goes for the ECC.
If current signatures are at hand the money is released, but in both of the cases the bank account would be either on the foundation’s name or the ECC’s name.
In the meaning of mutli-sig for releasing a transaction i’am not arguing, that’s absolutly possible. What i doubt that can happen tax and legal wise is that a for profit company & a charitable company can have a joint bank account (that would be the real life equivalent).
In theory and with online wallets i absolutly agree that it’s possible and doable, the legal and tax factor seems to be complicated as well as tracing funds from donors. I mean they don’t get the stuff with a trademark multi-sig legally done yet, what’s left for a way more complicated issue?
That’s actually why i think that out of so many available funds real legal advise upfront pays out as it makes clear if something is possible or not. Here we have a nice saying: In life you need only 2 things: “A good attorney and a good accountant”
Let’s indeed what someone with more insight or allready done research has to add. I was just sharing my concerns in case nobody yet thought about possible complications and outcome of such construction.
TLDR - I support many aspects of the Foundation’s approach but am unsure of the push for the ECC to convert to a non-profit. Unless the ECC is on the same page about a conversion, it feels like an unnecessary request. There are approaches that solve the stated problems without forcing the ECC down this path.
Thanks Sonya! I appreciate the thoughtfulness that went into this statement. I’m completely on-board with the intention that all future protocol funding received by the ECC go towards development and operating expenses, and that excess funding from block rewards should not be taken as net income or distributed to founders / investors (which I don’t think is anyone’s intention). I do think it is very desirable for the ECC employees to receive compensation and incentives in ZEC on a long-term vesting schedule, aligning incentives with the long-term success of the project. I agree that a compulsory development fund offers more certainty for long term funding than an opt-in fund.
I’m having some trouble wrapping my head around the request from the Foundation that the ECC convert to a non-profit to receive funding. Unless the ECC is onboard with this conversion, I think this may be well intentioned but a potentially unnecessary complication. The most compelling argument for me was around the potential securities treatment of ZEC, however I’m not sure how serious this is or if it’s just a bonus justification. Hasn’t this issue existed for the past three years? I understand that it would be cleaner if everyone involved was a non-profit, however I’m not convinced this goes beyond convenience and optics. The following assumes that the ECC isn’t already onboard with this request and that converting to a non-profit is a non-trivial burden for the ECC:
To play devil’s advocate, hasn’t a non-profit already been created for this specific purpose - the Zcash Foundation? I can understand that the Foundation does not want the sole responsibility for managing funds, however it feels like a stretch to then force the ECC to convert to a non-profit. If the ECC becomes a non-profit, does this make the Foundation redundant? Wouldn’t there basically be two non-profits with nearly identical goals?
It appears that the issue of fund governance can be solved at either the protocol level or the Foundation level (or potentially both). The Foundation seems most comfortable solving this issue at the protocol level, but then stipulates that any participants at the protocol level should be non-profits. The alternative of managing the funds at the Foundation level would significantly increase the scrutiny on the Foundation, it’s governance, accountability, and legitimacy. I can understand why it’s more convenient to solve the problem at the protocol level but wonder if this is just punting hard problems at the Foundation to a different day.
I see two straightforward approaches to solve the concerns around the ECC (there are probably many more approaches):
The non-profit foundation manages all funding; or
A shielded address receives all block reward funding. Assuming the technical details of this can be solved in a year, viewing keys are made public for all to observe. A two of two multisig exists with the Foundation and the ECC each holding a key. Neither party has any “ownership” of this address. Both entities submit annual budgets and receive funding based on 2 of 2 approval. Both entities are subject to annual audit by a third party audit firm. Excess funds sit in the multisig (this is an issue I think all development funding models need to consider - if Zcash succeeds there will be way more money flowing in on an annual basis than can currently be spent wisely).
In either scenario, there should be an agreement upfront to revisit the governance of the development fund in the future and a stated intention to adopt a more decentralized governance model when such systems have proven successful. For example, the intention behind the “winning” ZIP should be for perpetual funding but the actual implementation of the ZIP could only last for four years, at which time the community can review and decide to continue funding or make a change (hopefully minimizing capture along the way). At that time, the protocol could be much better equipped to transparently govern funds in protocol. My instinct is that if you add in protocol funding, you probably have to add some means of governing those funds.
I hope there are at least a couple productive thoughts in this huge block of text . I deeply appreciate the work of both the Foundation and the Electric Coin Company and hope we can realize the vision of a global scale, private Zcash.
Seems this statement did not got re-twitted even once by any ECC or ECC near account on any social media. Makes me believe they are not overjoyed with the Foundations statement at all.
There is still the chance you get an invite to the Foundation Governance Panel and issue your vote there. Thinking about the Foundatins Governance panel i think it’s quiet possible that after the last voting/polling was over 1 year ago there will be some members that won’t show up there. It might be a good idea to replace these “vacant” places with active memebers, be it from the forum, social media or other interested active members.
There is no general answer to this in my opinion as every mining facility has it’s own operation & electricity costs.
The miners located in very low electricity regions (China, former Soviet Republics) will probably ROI. On the other side i could bet that nearly no western european miner (Germany, France, Italy, Spain, UK, etc.) will ROI ever, even less with the current low prives. For the US miners it is mostly up where they are located, most won’t ROI in my opinion but some could if by luck they are located in some of the few lower electricity regions.
See as well the above answer to Sonya. I used a mining calculater to give an estiminate of how long it would take with todays ZEC price to get the initial investment back (without profit) at the current difficulty and a $13 per kw/h price for electricity as a benchmark. As Germany for example has over $0.35 per electricity it’s clear they will never ROI, but a chinese miner with $0.05 for example will have ROI-ed pretty fast…
Innosilicon A9++ ZMaster = 400 days
Bitmain Antminer Z11 = 300 days
Innosilicon A9+ ZMaster = 540 days
Innosilicon A9 ZMaster = 571 days
Bitmain Antminer Z9 = 1235 days
Bitmain Antminer Z9 Mini = Never, allready operating at loss
It’s not an accurate calculation as hardware prices for everybody varies, even more if we add shipping costs, custom taxes, PSU and maintaince. It as well shows only a forcase if bought today at todays ZEC price which are volatile anyway.
However, i think it’s enough accurate to show that chinese miners for example won’t have a problem to ROI even if they buy the hardware today while other countries with above $0.13 per kw/h electricity cost will either barely ROI or never …
This would exclude automaticly a charitable foundation as the recepient having in mind it’s a mandatory dev fund. At least in my opinion.
My personal opinion is that whatever funding is choosen it should be set only for 4 years and than being reviewed and discussed again.
The reasoning behind this is that we have no idea what works out how. Making an unknown funding fixed could lead to new broken protocol promises. 4 years in my opinion is anyway for my taste a very long period, leave alone 8, 12, 16 yers…
A shorter period would allow more flexibility in my opinion. I even think 2 year intervals might fit best as in a funding discussing they could include exact known road map targets, cost for wages, possibility to adapt to whatever changes that happened meanwhile etc…
I’am speculating and guessing here, but i could imagine that the ECC can not change it’s status bevor the FR expires due exactly this, the Founders Reward distribution along a couple of recepients. This could include the likely possibility that recepients of the founders rewards are as well share holders or a similar construction where the Founders Reward is somehow tied to company shares.
I guess and that’s just my opinion that this is an attempt to exclude financial interest beyound development and research and add way more transparency and accountability. The direction and work itself should not be effected by whatever such change, hence they should in most parts, as it’s now, not overlap.
IF excess funds sit in the multisig than there is absolutly no reason why to maintain a for-profit company. A for profit company’s target should be to make a profit. Having two non profits just ensures that it will be indeed like this without the possibility of doing else anything that generates profit. This should lead to more development & research with available funds as the profit target is excluded automaticly.
And while playing devils advocate you should think about a situation with a 2 of 2 mutlisip wallet that either side could block funds forever in worst case which would be even a worst case scenario.
A “could” shouldn’t be enough, when we talk about that much money a “must” gives way more confidence. Just my personal opinion of course…
Call for an extension of the * ZIP draft submission deadline — Aug 31, 2019
I think it would be more than fair, necessary and good if the deadline at least for the draft submission would be extended with at least 2 weeks.
Reasoning: While the discussion itself begun more or less allready in January and some proposal authors made their proposals allready at the end of june, just the recent days we, the proposal makers, get just now more detailed information about guidelines from the foundation and even a statement of the ECC as an answer to the foundations guidelines is still being “internally discussed”.
Having in mind that the foundation just now came out with their guidelines for further funding and the ECC’s answer is still on it’s way i think it’s more than fair to call for an extension of the deadline with at least 14 days so proposal makers can review, re-think and adjust their proposals and/or new proposals can be made that fit the new facts we just got and will get these days.
Having about only 10 days time from today doesn’t sound realistic IF someone wants to make a proposal with all the new facts, guidelines, thoughts, possibilities presented these days.
. I deeply appreciate the work of both the Foundation and the Electric Coin Company and hope we can realize the vision of a global scale, private Zcash.
