NU7 Coinholder Vote

[aquietinvestor]

Hi @daira. Thank you for the feedback on the NSM questions.

@daira

Funds are removed from circulation by the mechanism of ZIP 233. That wording was carefully chosen and is what should be used in all governance discussions. The wording of Q1 should be changed accordingly. Also, “fee reissuance” is simply incorrect. What is eventually reissued is only and exactly the amount removed from circulation. That must include at least 60% of fees in each block.

You’re correct. We agreed to use the terms “remove from circulation” and “recycling into future block rewards”. Therefore, Q1 should be updated to read:

The component of the Network Sustainability Mechanism that removes ZEC from circulation is already approved. How that ZEC is recycled into future block rewards remains unresolved. In no case will the total supply of ZEC be affected.

Which approach do you support?

1. Smooth issuance curve. Replace halvings with a gradual issuance curve. ZEC removed from circulation by the NSM is recycled into future block rewards along the same curve.

2. Preserve halvings. Keep the existing halving schedule for new ZEC. ZEC removed from circulation by the NSM is eventually recycled into future block rewards.

3. Do not include issuance smoothing in NU7. How ZEC removed from circulation by the NSM is recycled into future block rewards is left to future governance.

4. Abstain.

@daira

There would be significant negative ZEC monetary policy implications if the issuance were to abruptly increase at activation, which is why it was designed this way.

The next date after that at which the smoothed issuance curve intersects the stepped one is in February 2031 (not at the fourth halving which is expected in November 2032).

This framing assumes the smoothing version of ZIP 234 is adopted, but Q1 is considering two different ZIP 234 implementations: one that smooths the issuance curve and one that preserves the existing halving schedule. Q2 therefore needs to account for both possibilities. If halvings are preserved, the curve-intersection dates aren’t relevant. So I think the choices should be framed around the earliest applicable recycling date under whichever implementation is selected in Q1: the next intersection point in February 2027 if issuance smoothing is adopted, or as soon as possible after activation if halvings are preserved.

I think Q2 should be updated to read:

Q2 (NSM Reissuance Start Date)

NSM has prior coinholder approval. This question concerns when ZEC removed from circulation by the NSM should begin to be recycled into future block rewards. The applicable dates depend on the issuance approach selected in Q1.

When should NSM recycling into future block rewards begin?

1. At the earliest applicable date under the approach selected in Q1: at the next point where the smoothed issuance curve intersects the existing stepped issuance curve (approximately February 2027) if issuance smoothing is adopted, or as soon as possible after NSM activation if halvings are preserved.

2. At the later applicable date: at the following intersection of the smoothed and stepped issuance curves (approximately February 2031) if issuance smoothing is adopted, or after the next halving if halvings are preserved.

3. Abstain.

@daira

NU7 will include NSM fee recycling, […]

That can’t happen if NU7 doesn’t include a transaction format change. Also, no funds removed from circulation will be recycled anyway until February 2027 at the earliest, as I pointed out above. So, delete “NU7 will include NSM fee recycling” from Q5, because it won’t.

Agreed on the transaction format change point. If NU7 does not include the ZIP 233 transaction format changes needed to remove ZEC from circulation, then Q5 obviously shouldn’t say that NU7 will include NSM fee recycling.

There’s a separate question around ZIP 234, though. Depending on the outcome of Q1, it may still make sense for NU7 to include implementation of the mechanism for recycling ZEC removed from circulation into future block rewards, even if the actual recycling does not begin until later. So I think either Q5 should mention ZIP 234 inclusion depending on the result of Q1, or we should remove any mention of the NSM from the question and refer to the poll results more generally. I think the latter is the better option.

So Q5 should be updated to say:

Q5 (NU7 Scope and Readiness)

NU7 will be consistent with the results of this poll, assuming each applicable feature is implemented by September 30th.

How should features that are not ready by the deadline be handled?

1. Ship NU7 as soon as possible, removing any feature that is not implemented by the September 30th deadline.

2. Delay NU7 until every applicable feature approved in this poll is deemed complete.

3. I do not support this NU7 plan.

4. Abstain.