Let's bring stablecoins to ZSAs!

I tend to agree with the sentiment of waiting until ZSAs v1 goes live on mainnet before funding such a big project.

Who knows maybe with a successful deployment of ZSAs, stablecoin development can be sought without funds from the community coffers.

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Sounds a little bit like buying 10 videos before one was completed. Or funding 3-4 wallets before we have one good wallet (and no hardware wallets for Z)…I like the idea of proving it out first. However, stablecoins as an asset class is already proven.

For wallets, the box office numbers are out, and they dont look very good. For Android,

Nighthawk - ~5k downloads
Zingo - ~1k downloads
YWallet ~ 5k downloads

—> Compare this to Metamask with 10m downloads.

I hope you use the same logic when it comes to voting on more videos, wallets and other projects where the box office numbers are out and not looking so good.

We might not need to fund this now, but they do need to start saving…

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Not a bad idea. If Qedit could keep the cost at a reasonable level, and we (the funders) would own the residual interest in the float, I would invest (with the presumption it scales, and transaction costs are not an issue)

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Yes, ywallet was funded retroactively.

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“Stablecoins are inherently centralized assets. This is because they must be issued against collateral, which would be held by the issuer. The issuer is thus a point of failure, and needs to comply with authorities. This cannot be done when the Assets are completely untraceable.”

Are you saying that ZSA Stablecoins would theoretically not be able to be frozen or blacklisted like centralized stablecoins?

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as stupid as it may sound. WHO would want to keep their BTC or ETH on Zcash?

The Bitcoin community isn’t our largest friend and supporter, so i see this going nowhere.
Same as with ETH, with Aztec, Railgun, and others launching on Ethereum there will be close to zero interest in moving these funds to Zcash. (it might also be more expensive to brigde these funds to our chain)

I see stablecoins as the best ZSA that we can currently think of. The marketcap of stables also perfectly refelects that.

Just build it with a regulated framework in mind and we should be good. If not, it would have not worked in the future either!

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I think the real opportunity here is that BTC, ETH users can gain privacy for their holdings if storing in the shielded pool.

Plus since ZSAs will use the Orchard pool, the more activity that ZSAs have, the more it helps boost the anon set for the everyday Zcash user, win-win.

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i don’t think that this will get used anywhere near as much as stables would.

there is no real incentive for ETH users to bridge their ETH to zcash, Aztec for example will have a shielded pool themself and will most likely provide an even larger shielded pool than Zcash does. (with the current prize in ZEC, the shielded pool isn’t that large)

AND it’s easy to use and doesn’t require high bridging fees and getting used to another protocol. one example that pops up in my mind are hardware wallets, we don’t even have a single HWW that currently supports shielded ZEC, so how long will it take to get them ready for ZSA? All those ETH protocols have that from day number one. For me as a user, I see no reason to bridge my ETH to Zcash, and i must say that i love Zcash.

Getting others to Mix their BTC in the Zcash pools doesn’t provide a lot of privacy if there aren’t a lot of users doing so. And with BTC mixers getting hammered down by regulators and exchanges, i don’t see this as a big win either.

I would use shielded stables to pay for my everyday transactions, but i wouldn’t bridge my ETH or BTC to Zcash. It would simply hurt my “source of funds” history and makes everything more complicated. The only winner here is that the Zcash pools would grow, but how many of us are there that really care about that? The size of the community isn’t growing, it’s actually going in the opposite direction since a long time.

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Stable coins is an awesome use for ZSAs. But I’m just a bit confused about this proposal.
This proposal is for developing features on ZSA that will allow stable coins to be eventually implemented, it’s not a proposal for implementing the stable coin itself, right? So it’s possible that QEDIT implements all these stuff, but no stable coin issuer will come to use it … or if they come, it will most likely means yet another grant to implement the stable coins …
On the budget you mention it’ll cost roughly $215k per month, but as far as I can tell you didn’t mention how long it will take. How can ZCG commit to this proposal if they don’t know the duration, hence they don’t how how much it will cost then in the long run?
Also, why 8~9 enginners on this project? I believe entire crypto projects don’t have that much engineers. And AFAIK the bulk of ZSA is already coded, does these modifications really need that amount of engineers?

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I believe that Qedit are the leaders of the Zcash development teams right now. Their focus is what all of the teams ought to strive for. Building products for the protocol, not doing political lobbying, hedge funding other crypto altcoin projects, or spending resources organizing vacation destination conferences.

Zcash as a decentralized software project needs a lot of work. Qedit has shown a strong record of getting the job done on-time, and within budget.

I support funding this project via ZCG, as needed, and also that Qedit should be upgraded to become a block reward recipient (if the block reward model is renewed later this year).

Qedit’s ZCG grant could be written with contingencies to allow for a funding hand-off based on their upgrade to receive block rewards.

Zcash ZSA’s should primarily target the stablecoin use case, because as others have noted, that is the most natural use case for the feature. Crypto natives from other chains are not going to be falling over themselves to port BTC, ETH, NFTs, et et into Zcash ZSAs; I’m not saying that isn’t a use case, I’m saying that it is not the correct target use case.

(Here in the forum, we have a lot of Zcash natives that will talk gleefully about porting their NFTs and ETH into Zcash, but lets keep level headed about this… we should not be our target use case, we need a target growth use case, that might attract new users)

Zcash ZSA stablecoins will allow the project to finally provide for its mythical use case as a day to day private fiat payments network! I believe its critical that we approve this grant, so that Qedit are able to keep their momentum/ staff/ integrations moving ahead without interruption.

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i forgot to mention that i also support funding this project.

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Can just use Aztec on ethereum. will be live before ZSAs. Thinking ethereum users will use zcash is probs a bit optimistic.

I think OFAC censorship is at 38% as well, so better than it was. But, you could use zcash as a hedge against ethereum in some sense, so maybe that’s a worthwhile argument.

Bitcoin a bigger target imo. Trust minimized bridging looks like will be live before ZSAs. See here bitvm-js/docs/sidechain_bridges.md at main · BitVM/bitvm-js · GitHub

Worth exploring if Zcash could implement this style of bridge program.

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I also want to note that I’m in favor of funding this effort, just not yet.

QEDIT is a capable team for sure but there is no actual working ZSAs yet, no wallets that support ZSAs, no other ecosystems that bridge to ZSAs, etc… so funding a ZSA stablecoin at this point in time is way early.

What happens if the upcoming audits come back and the ZSA code has some bug, and it has to be delayed past Q1 next year? Or ZSAs get launched and some other sandblasting/spam unknown issue occurs?

We need to battle test ZSAs for a bit before entrusting real world assets in them.

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Those are all strong points of concern, but I think that ZCG has already set a precedent with its Zcash Media multi-funding actions.

Zcash Media made the veiled suggestion that if we don’t fund them again, they’d leave for good. And what did the community do? We funded them!

Qedit is at the same risky/ uncertain juncture. We shouldn’t force them through a year long period of uncertainty/ work stoppage because their ZSA product is held up by dependencies on the ECC/ other externalities.

We’d all love to snap our fingers, and have ZSA on mainnet right now, to allow for some battle testing and exploration, but it isn’t in the cards.

As an alternative, I wonder if the Qedit staff have the skills to work-in with the ECC to attempt to pull in the ECC productivity going into NU6 (?)

The global talent pool of software engineers who can work on Zcash is tiny, so it would be a huge loss if the Qedit team were roundaboutly shown the door, because they couldn’t span this funding gap.

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True, so the solution to a prior bad precedent is to double down and set the same for other projects?

I don’t think a grant should be issued prematurely for the sole reason of keeping a team busy. Since ZSAs are on such a long time horizon, why not find other pressing matters that they could apply their skills to? Like testing upcoming POW/POS structure? Or adding other Zebra functionality?

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I don’t think it was a bad precedent, in an agnostic sense, it just turned out that ZCG over paid a lot for underperformance of the products/ delivering to schedule that Zcash Media originally committed to.

In the generic sense, I think its a good precedent that if a grant is for more than a half of a million dollars (pick your favorite magic number), then there ought to be a soft assumption that the grantee(s) would be expected to stay in the ecosystem longer/ work under additional big ticket grants.

This makes sense because it gives the ZCG a means to attract and retain talent across a multi-year timeline.

I agree with this completely

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The likely reason ZCG is bringing this up is because they dont have the money to do everything people want; especially if we continue down the ZEC is fiat for day to day spending vision which leads one to fund ZEC centric projects like wallets, and media. My personal view is we alter course now and realize ZEC is fiat for day to day spending is not going to work and begin to move in a different direction which is applying the Zcash privacy features to ZSA and stablecoins (which would be perfect for day to day spending).

The worst case scenario in my view is we dont fund now and then we spend the block rewards on more third party wallet funding (dont get me wrong, I think its amazing/great/important that other people want to build wallets for Zcash; but they need to figure out how to fund themselves outside of block rewards because we need to make Zcash blockchain major improvements), more media (same comment as wallets), and non critical development. Then, when the halving comes, they dont have the money because it was already spent. That means we need ZCG to start building ZEC reserves to make they sure can fund a new course.

Once ZCG can right size its cost structure and project funding, then ideally they are receiving block rewards at a rate more than they are spending. We should have them prefund ZSAs/stablecoins, and critical projects.

We should try to get ZSAs in NU6; start testing ASAP. But if we cant get there. ZCG should be saving ZEC and build a reserve (amount TBD) so they have the money when its needed. We should not be tripling down on projects that are not delivering more users, or more transactions.

Agree here too. I would say helping to deprecate Zcashd as well as getting ZSAs into NU6.

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As I’ve said previously

The ZF Zebra engineers have been meeting with the QEDIT team on a weekly basis for some time now, and we will prioritize reviewing and merging the PRs that enable ZSAs as and when QEDIT submit them.

@_jon & @vivek - If there’s anything we can do to speed things up, let me know, and if you ever feel that ZF is an obstacle or a bottleneck to getting ZSAs deployed, feel free to call me out publicly!

ZSAs could be rolled out before zcashd is deprecated, with the caveat that doing so would require that zcashd be updated so that it continues working (i.e. retains, at a minimum, its current functionality) after the network upgrade that deploys ZSAs.

Right now, there are effectively two paths to deploying ZSAs.

Plan A is to add support for ZSAs* to both zcashd and Zebra, and activate ZSAs on mainnet.

﹡ To avoid any confusion, “support for ZSAs” in this context means consensus rule compatibility - i.e. the node will recognise V6 transactions (including ZSA transactions), be able to validate them, gossip them across the network, and include them in block templates. It explicitly excludes adding support for ZSAs to zcashd’s internal wallet.

Plan B is to add support for ZSAs to Zebra only, which means that ZSAs cannot be activated until zcashd is deprecated. In order to deprecate zcashd, we need to create alternative solutions for the key use cases that people currently rely on zcashd for that Zebra doesn’t yet support but should (e.g. the functionality required to act as a back-end for block explorers) or has no plans to support (e.g. zcashd’s integrated wallet). Then we need to coordinate an orderly and timely migration by key ecosystem partners (e.g. exchanges).

I want to be clear: ZF is committed to working with ECC to make it possible to deprecate zcashd. If it were the top priority and primary focus for both ZF’s and ECC’s engineering teams, I think we could make very rapid progress, maybe even get it done in time for the Halvening. However, ECC has other priorities, which means that the timeline isn’t clear.

So, the choice is between getting ZSAs deployed ASAP by expending the effort to add support for ZSAs to zcashd, or delay ZSAs until we deprecate zcashd but with no clear timeline.

Personally, I think getting ZSAs deployed should be the Zcash ecosystem’s top priority. Nothing else that anyone in the Zcash ecosystem is working on at the moment comes close to the potential for ZSAs to improve Zcash’s utility, expand its functionalty, and enable more use cases.

Let’s JFDI.

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beautiful to see orgs coming together :heart:

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[Speaking as ECC’s R&D Engineering manager]

ECC has been very clear that we do not intend to add major consensus features like ZSAs to zcashd. If some other organisation wants to do the development then they can, but they shouldn’t underestimate the amount of work required.

In any case, I strongly believe that it is not safe or feasible to rush ZSAs into NU6, if NU6 is to activate before the next halving expected in November. That is even if someone were to implement it in zcashd. The auditing required for the circuit changes alone is very substantial.

ZSAs in NU7 is ECC’s “Plan A”.

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