Question about the initial offer


#1

Hi, I have been following this project for while now. I am very happy to see that finally this project is getting on the ground. Thank you for the hard working.

I have read that the blog post about funding of this project on "Funding, Incentives, and Governance."
https://z.cash/blog/funding.html

My understanding is that Zcash will be distributed like Bitcoin except the certain percentage, 20% of the mining rewards, will go to the funding team. Is my understanding correct?

If so, there will be no ICO, Air drop or premined coin sale. Therefore, only ways to acquire the coin in the early stage are two options, (1.) mining, and (2.) buying the coin on exchanges.

Am I right?


#2

Based on the currently available information, you are right. The mining algo has not been announced yet, AFAIK also.

So, basically the "initial offer" is an opportunity for you, and other people interested, to follow Z.cash on the test net, and thru alpha/beta etc, so that when the mainnet goes live, you can mine with everyone else-- providing power to secure the network.


#3

The 20% of mining rewards going to the founders is only until the first reward halving; after then, all mining rewards go to the miners. Other than that, AFAIK you're right.

We will be implementing mining "slow start" to allow the hash rate and difficulty to settle over a few weeks before the reward becomes meaningful.


#4

nirvana, Thank you for responding. Do you think it is going to be meaningful to individual joining the mining, profitability and strengthening the network?


#5

a slow start is a good&fair idea - i like it


#6

str4d, Thank you for the info. Do you play violin or that is a cello?

I have one question and one idea.

Mining "slow start" give more chance to individual miners or large miners?

"Satoshi" has 1.5 million bit coin and I am sure early developer hold a lot of bitcoins, so 10% of total amount ZEC to founders is reasonable in my opinion, but only the market knows the answer. It is naive to think everything should be free or someone should work you for free.

Have been said that, the altcoin market is very small and volatile. Investors / speculators are worried about pump and dump. People who have a large portion of the coin has huge impact to the trust of the currency. Just imagine that how much damage can make to the Bitcoin price if "Satoshi" starts selling his Bitcoin.

In order to gain the trust from the market and grow Zcash as one of trusted crypt-currency, it will be beneficial that founders will hold large portion of the coins for the long period of time. The first four years will be very crucial because the founders' coin in the total money supply is very high, 20%.

One thing that you guys might be able to do is that making the information of the founder reward open to public. It like as everybody can see the Satoshi has used his coin or not. Zooko told on some videos that Zcash have selective anonymity, right? It might give the stability on the currency. You know you can dilute the share of the company to get more investment if you need cash to run the company. I am sure that also the company can be borrow money against to the Zcash holding. Probably it will be the better strategy than keep selling the founder reward portion in the coin market.

It seems like the value of your company will derive from the market price of Zcash, unless you guys start making eother products. Then, it has huge incentive to make the coin value high and stable as possible.

We need trust in the trustless network. Funny


#7

This seems to be the PoW the Zcash team is leaning towards: https://www.internetsociety.org/sites/default/files/blogs-media/equihash-asymmetric-proof-of-work-based-generalized-birthday-problem.pdf


#8

Violin, as it happens :slight_smile:

It doesn't affect the mining algorithm in any way, so the computational advantages of individual miners vs large miners is theoretically no different to without "slow start". Whether there is any discernable advantage in practice depends on whether the decreased initial reward affects the number of large miners who decide to jump in right at the start.


#9

z.cash will competed with bitcoin is exploded as bitcoin is darkcoin it may be speculative and based on the rise I guess z.cash could increase from 1 cent to 2 dollars in 12 months


#10

Str4d,
Thank you for your response.
I thought that is a violin. :slight_smile: Maybe I should make my picture a guitar.:smile:

I never mined coins but I think I will try for zcash. It is a challenge for me but I like learning new things.

I think privacy has huge value for people but also business. Zooko mentioned in his interview about that and I agree with him. Who wants to show the amount of your bank account and all transactions to public? Almost nobody. It is not only because you want to hide shady or illegal things which you don't want to tell people, but it is mainly because it will tell everything about you to public. All the advertisers or taxers love to know all those information. On top of that, if you operate business on an such system. You show all your business strategies and logistics to all your competitors....Basically you can have business secrets. So even the dollar fails tomorrow, I am not sure how many serious businesses will switch to systems like Bitcoin. If we want to see mass adaption of crypt-currencies, definitely we need privacy... Zcash seems to promise to do so. That is why I see potential.

I would like to ask two more questions because of that.

Where was Zcash Electric Coin Company incorporated in?
I have been researching this and I haven't find any information about this. The reason of asking this is the company can be a target from bureaucrats if Zcash will be widely successful, especially you know which one, right? I wish you guys choose the location wisely from the future's political attacks. A bureaucracy basically can operate in a specific territory, so to be in outside from aggressive ones are helpful. It might not be perfect but at least giving you guys time to prepare for such attacks.

My second question is the Bitcoin's adaptability. How easy or difficult can the Zero-knowledge protocol be adapted into Bitcoin? Is any technological difficulty to do so or any incentives to resist the such adaptation- it seems like they have a hard time to make a concessions to adapt new technologies so far thought.

If people start seeing the value of privacy, then rival currency such as Bitcoin will try to adapt the same technology? Then in the point, zcash will have any advantage upon the Bitcoin which has a huge network effect already?

Thanks


#11

"I wish you guys choose the location wisely from the future's political
attacks. A bureaucracy basically can operate in a specific territory, so
to be in outside from aggressive ones are helpful. It might not be
perfect but at least giving you guys time to prepare for such attacks."

good question.


#12

http://www.delawareregistry.org/the-zerocoin-electric-coin-company-llc


#13

I sent my reply on this topic to the security zcash email. I though it might be appropriate to not post on public. thanks