Future of Zcash dev funding — megathread / everything in one place

Community Collaborations protocol
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I think there are a lot of people complaining about ICO’s and lot that are hidding silently after it turned out they made a stupid move while investing into scam or doomed to fail ICO’s. And some of these ICO artists got what they deserved, jail.

My personal opinion and from reading is that a lot of people would have been fine with the Zcash funding model IF most of the funds had been used indeed for the foundation/ECC. Or in other words if the distribution of the founders reward was more toward pure developement. But that’s just my observation and thought.

You are probably right here, but i doubt this will happen. I’am pretty sure the ECC & foundation will find a way for further funding, probably even the 20% they request somehow.

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Here is our statement! Zcash Foundation Guidance on Dev Fund Proposals - zcash foundation

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Moreover, such funds should not be used to directly enrich investors or founders.

We strongly prefer that any protocol-based dev fund be distributed to nonprofits and the Foundation cannot accept a fully mandatory fund that pays out even partially to a for-profit company. We encourage ECC to convert into a not-for-profit organization.

I couldn’t agree more.

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Excellent.

I understand now why ZFnd shouldn’t be the gatekeeper of dev funds - I still think they would be great at it but when you add ‘developing zcash’ to their role it gets awkward.

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Excellent statement. I couldn’t agree more to all that was published. If all goes well, this will cancel out enrichment to founders and/or early investors, and will surely provide more transparency and accountability. I wish i could have been part of the voting but sadly i only joined in about 6 weeks ago. Will be reading the statement again and post further thoughts. Great work from the Foundation on this one!

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Throughout the following comment, I am speaking only for myself.

Last week, I wrote this in a private conversation:

I feel so conflicted about this dev fund thing. Both sides — no dev fund and some dev fund — have made arguments that I find compelling. Maybe I’d be okay with either outcome. I can see the possibility of Zcash flourishing and fulfilling its purpose in either scenario; I can also see the downfall of Zcash in either scenario.

Maybe if projects like Ycash and PirateChain didn’t exist, or Monero et al, then I’d feel more strongly that there shouldn’t be a dev fund. But if someone is paying attention to Zcash, they have time to exit into an alternative. And I see the path dependence of Zcash, I understand that the creators couldn’t see the future, and numerous decisions were made without the benefit of 20/20 hindsight. That’s just life.

Anyway, are we obligated to protect the interests of Zcash holders who aren’t keeping up the project? I don’t know. I think there’s an argument that we aren’t obligated: Zcash has always been a science experiment. An incredibly successful science experiment! But buying ZEC has always been a bet in one sense or another, and if you’re not tracking the conditions of your long-term bet, that’s your prerogative but it might have consequences.

I find myself torn between rigid principles and murky context.

After much deliberation, I’ve decided that I’m okay with instituting a new dev fund — but only if Zcash miners have time to break even (at least!) on their current machines.

Does the October 31 decision deadline give miners enough time to earn out their hardware investments, and switch away from Zcash if they want to? (I’m sure this has been discussed before, and I just don’t remember the answer.)

In general, ZEC owners have plenty of time to sell and choose other options. I’m not worried about them. Like I said above, someone who bought ZEC and then proceeded to ignore the project knew that they were making a risky, speculative choice.

That’s my opinion about the ethics of creating a new dev fund. It boils down to “fine, with a few caveats.” Two remaining concerns:

  • Existing Zcash alternatives are not 1:1 clones — different teams, different ecosystems, different technical tradeoffs, etc.
  • Creating a new dev fund legitimately would break the original promises about Zcash economics.

But ultimately… I can live with it. I’m still okay with the no-dev-fund option too, although fewer resources = slowing down Zcash progress, at least for a couple of years.

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hmmm Are your intentions to crash the price of ZEC to single digits? cuz if that’s the case you’re doing a fine job at it, truly! :ok_hand:

Choose other options? Sorry young lady, but wether someone chose to ignore the project or stay updated regularly is irrelevant. Some who stay closely updated to developments and are invested for the long term rarely do any daytrading, and yes You should be worried about them. What if they bought their coins at mid-triple digits because they are beleivers of the proejct and mission of Zcash and held on their coins down to the bottom hoping the price would recover, given the cutting edge technology and the importance of Zcash? But hey! as price is on a freefall, why not fork the damn code and create Ycash…while you’re at it let’s release a major broken promise to the mix for a dev fund renewal of $1m+ per month for at least 4 years. Sorry but those things are not in investors’ control. If anything coin holders should be feeling betrayed by the uncertainty and the incompetence of all of this mess!!! And what do you expect them to do? Sell for Ycash? for Pivx? for fucking XVG? or why not take a bigger loss and invest in the safest of them all Monero which is currently priced at $30 per coin higher than Zcash…Sorry! but your message is in extremely poor taste, and EVERYONE at ECC and ZF should have some sort of moral and fiduciary responsibility to their coin holders and miners and investors. This is shameful im even reading this!

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…is it news to you that people can sell their ZEC if they don’t like the direction of the project? I’m not encouraging people to exit, I’m just saying that they’re able to.

Literally everything I wrote was about ethics and project sustainability. If I were oriented toward pumping the price, I’d advocate for slashing the emission rate.

Edit: Anyone who buys a cryptocurrency, including BTC, and then indefinitely ignores the software development and roadmap behind that cryptocurrency, is playing with fire and will get burned.

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Another one of my daft ideas… guess the megathread is the place to do that?

The miner signalling really worries me, how about if signalling was moved to transactions?

Adding a byte to transaction data would be enough for the USER to specify which dev fund stream they want to support. This covers a wide spectrum as pools also send transactions, so do exchanges, everyone is a user in some way.

A block reward dev fund payment could then be generated based on the transactions mined in that block.

There are zips that call for a change to transaction data so maybe this could be included. It’d be a cool feature for wallets to integrate with.

Maybe ‘voting transactions’ should only be z2z? That could also help drive adoption.

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So if I understand correctly, in this scheme the dev fund is mandatory for miners, but users vote with transactions, and that dictates how the 10% (for example) is allocated?

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Yup - there is a mandatory fund but the amounts paid to recipients from a block would depend entirely on the transactions it contained… reward from empty blocks gets burnt.

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This is critical for sure. I think the expectation is that the deprecation cycle for mining equipment is about 12 months, which matches this timeline. But I don’t have a citation for that, so hmm
edit-
Also worth noting, the timeline requirements would also be the same for any change to the PoW parameters, for example

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Sure, it’s so easy to sell your investment when it’s 70 to 80% down. Coin holders are not traders. Theyre long term investors because they beleive in the project and the mission and the direction. But when the project team pivots, or comes up with a major change such as new dev fund, or breaks for a new direction, what are we supposed to do? take the 80% loss and invest in a third tier privacy coin with zero visibility that most likely is a fork off Monero? ECC and ZF should be accountable and to maintain importance to their coin holders, as Zcash should be seen as Way more than just a science experiment.
And no one said pumping the price, but no one asked for crappy strategic moves one after the other that just kept negatively impacting the price day after day…Funny how the first thing one would say is “pumping the price” as if we’re all moonboys. though im sure everyone at ZF and ECC would love it as it would solve a boatload of problems. IF this was nothing but a science experiment there wouldnt be a need to be listing the ZEC asset on public exchanges for the global population to invest in it…plain simple

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Isn’t that exactly what @zooko tried with the suggestion of splitting mining rewards into 50% ASIC and 50% GPU, where GPU rewards would be received over a period of one year? He wanted to slash emission rate in order to pump the price.

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Are you talking about the timelocking that was proposed as an aspect of Harmony Mining? The final NU2 Blossom Network Upgrade Goals

I didn’t think that was a good idea.

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Yes, I was talking about timelocking. It would slash emission rate for a year.

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Definitely true that ZEC mooning would basically solve our problems.

I just don’t know what to tell you. There is no scenario where a young cryptocurrency doesn’t change significantly in its first, I dunno, decade. Even BTC has changed a lot! There are wallets that don’t interop with more recent address formats, for example.

The degree of change is high-variance; the guarantee of change is not. The only static cryptocurrency is a dead, abandoned one.

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Btw, thread about changing emission, if that’s something you think we should do: Changing Zcashs Emission Curve

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No, I was just pointing out that @zooko attempted to pump the price by suggesting timelocking to reduce emmision, as you said it would be your preferred way of pumping the price if that was your goal.

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I like user voting in theory, but it wouldn’t be sybil-resistant unless we incorporated staking or something.

My favorite specific proposal (personally! again, just speaking for myself!) is @amiller’s: [ZIP 1004] Dev fund proposal: Miner Directed Dev Fund (was: 20% to any combination of ECC, Zfnd, Parity, or "burn")

With a side of your progressive halving suggestion, Bob: Dev Fund Proposal : Continued from block rewards with a halving schedule

What do y’all think of combining them like this?

  • 10% obligatory Zcash dev fund, to be allocated to a multisig transparent address controlled by N recipient organizations (each with a corresponding ZIP editor), and distributed equally between them

    • This arrangement should be backed up by a legal agreement

    • When N=2 each organization has a disbursement veto (2-of-2 multisig), when N=3 switch to 2-of-3 multisig, and when N≥4 use .75N-of-N multisig with conventional rounding

      • For example, if N=7, the formula dictates 5.25-of-7 multisig. Round that down to 5-of-7.

    • ZIP editor decisions should require a quorum that follows the same ratios as the multisig setup, and then >50% approval among the ZIP editors who are present

  • Additional 10% optional dev fund that miners can either burn or send directly to any of the N recipient organizations

That hedges the risk of miners burning every time, while maintaining a partial opt-in and allowing miners to signal. After halving, it sets a floor of .625 ZEC per block going to Zcash development funding, and a ceiling of 1.25 ZEC per block.

Then increment the percentage downward by 1 with every successive halving. In 2024, the floor of Zcash development funding should be 9% of block rewards (through the obligatory fund) and the ceiling should be 18%. In 2028, 8% and 16%.

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