Warning, essay incoming…
With the ZCAP expanding and with votes coming up which will require input from the ZCAP and the wider Zcash community, I’ve been thinking about some areas that I think may need attention for Zcash soon.
We have Halo 2 on the immediate horizon and it looks like ZSAa (or whatever we call them) are a good candidate for the next major addition, both of which are very exciting.
But after listening to some of the governance discussions during Zcon2, something else is praying on my mind and I was hoping others would be able to allay my fears.
I’ve been reading a very interesting book by David Deutsch called The Beginning of Infinity which has a chapter called Choices which talks about the role of elections and more broadly about the democratic process that is well worth a read, I’ll include a quote from that book in a follow up post, but the spirit of this post speaks to the fact that the decision making process starts with ideas, and votes/elections are an imperfect way to decide which ideas to try next and which ideas have outlived their purpose.
During Zcon2, zooko mentioned the fact that Zcash is currently becoming more and more decentralized, but that it is also still heavily centralized in the USA.
The ideas I’m looking to explore here are in relation to how we can tackle that geographic centralization issue, or to determine if it is actually an issue in the first place.
Currently we have two institutions in Zcash, the Electric Coin Company (ECC) and the Zcash Foundation. We also now have Zcash Open Major Grants (ZOMG) which acts independently but is under the control of Zcash Foundation. ECC currently receives 7% of the block reward, Zcash Foundation receives 5% and ZOMG receives 8%, the remaining 80% goes to the miners.
So as things stand, the 20% of the block reward that goes to fund all development/regulatory outreach/support in the ecosystem is currently directed to two US based organisations.
Which brings me to my question, which is:
What happens if there is a concentrated attack on Zcash? In particular by the US government, i.e. do the US government, if they so wish, have the ability to freeze ECC and Zcash Foundation assets?
If the answer to that is yes, or maybe, then what can we do about it?
The immediate thing that springs to mind to me is that either ECC or Zcash Foundation operations could be moved to another jurisdiction, is that a possibility?
Another option would be to spin out ZOMG as it’s own entity, and give it additional capabilities to use it’s resources to provide emergency development funding to either of the other organisations or their employees to continue core developments if the need arises.
I know some will say that we have already voted on whether ZOMG should be it’s own entity or if it should be under Zcash Foundation control. I personally leaned towards Zcash Foundation control at the time and I think that was the right decision while ZOMG bootstrapped itself, but that won’t necessarily continue to be the correct approach in the future.
Anyway, I have an open mind but I thought this warranted at least some discussion. I’d like to hear others thoughts on this, is this something we should be worrying about at all?
And if it is, what can we do to mitigate these risks and make Zcash as resilient as possible in the future?..