Resetting Zcash: its about privacy, not scale, econ, dev funds, or governance

General
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No one should say you don’t support Zcash. You clearly do. It’s your life’s work.
The question is what version of Zcash do we all support?

And I don’t think its fair to single out @zooko for this. When I wrote this post, it really was directed at everyone. Especially the comments in the leapfrogging taddr thread. And I don’t recall Zooko in there much. Certainly not in the part I read over Christmas. It was the furthest thing from my mind.

I will say, Zoooko, judging by your actions subsequent to this post, particularly in the leapfrogging thread, there may be a considerable gap between your vision for zcash and the communities. And we should discuss that.

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Dense isn’t fair. And this isn’t just or even primarly an ECC problem. Though they could have used their voice to stop it. And I should have sooner.

The problem is “privacy” is not an easy thing to convince people they need. The government isn’t reading your text messages or banking details so why use signal or zcash? Some people clearly need to, but no you. You have nothing to hide and no one looking. So its understandable how talking points change and ECC shied away from privacy.

But we did the wrong thing. We needed to point out why cryptocurrency is different and privacy uniquely matters for it ---- even if you don’t care about privacy in general or even for crypto.

With cryptocurrency: your financial data is naked and exposed to everyone. And it’s not even temporary, the data is there forever. That’s a non starter for real world usage. Businesses won’t expose data that way. But even that point is hard to make because frankly, there isn’t enough real world usage of cryptocurrency to yet. There’s no http for money, so there can be no https. Yet. Sure in the future, but right now … no one seems to care. We should convince them the future matters, but its not a perfect argument.

Cryptocurrency itself still needs privacy RIGHT NOW. Otherwise, you will shortly find out you can’t use your money when it gets marked as tainted by chainalysis. Or you find out you got paid by someone using a self-hosted wallet that wasn’t registered and now your money is suspect. It’s the fungibility problem on steroids. And before you know it, the only crypto that exists is some centralized version of paypal and all the energy and innovation that powered this is dead.

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The core of this issue is that ECC is being political and trying to build a network effect within the current financial system. Meanwhile, Polkadot, Cosmos, Ethereum, Tezos, are building sapling like pools within their protocols with the shield of neutrality.

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Not sure its political, but they are trying to build on things that just won’t bring people to Zcash. They are things half a dozen other chains either have or are promising. And they aren’t even our core strength, which is privacy tech.

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For Tezos, privacy is a feature. For Litecoin, with MWeb, privacy is a feature. For Dash, privacy is a feature. etc For Zcash, privacy should be a product not feature. Otherwise, hard to survive even with best tech.

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I’d agree with both of you although there is costs. Right now it seems to be a social vs financial(trusts/exchanges) paradigm with Zcash.

https://nakamotoinstitute.org/money-blockchains-and-social-scalability/

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As one from ECC in the trenches who is daily out engaging and thinking about Zcash shielded adoption, this thread is a little puzzling to me. Privacy is necessary, not a nice-to-have. Either the financial privacy afforded by Zcash is an inevitability, or we and generations to come will be be living in a dystopian panopticon. Some other things are also necessary if its to remain censorship resistant, available to everyone, etc. Otherwise just store fiat cash in a bank vault, which is also private.

We’ve been constantly briefing policy-makers, regulators, and exchanges about the importance of privacy. We write about it and socialize it. We provide metrics and track growth.

There is, or has been, a time component to all of this. It was not possible to use Zcash for private payments commercially at any scale, and would have been a mistake to focus too much energy there (or for anyone to market zaddrs there) too early, because it simply was not possible to use shielded Zcash on mobile devices. It would have been impracticable, unusable, unused and bad for the Zcash brand.

Similarly, exchanges couldn’t natively support it because they couldn’t do it at scale until Sapling. They have been, all along, accepting deposits from shielded addresses.

Even after Sapling activation, it’s not been so simple. For example, it took months of work with Gemini to work through HSM issues so that they could support shielded withdrawals with their infrastructure. It is likely the case that it would not be possible to send Zcash to a private address from a regulated exchange today without the existence of taddrs to onboard Gemini in the first place.

Even now, commercial custody is still an issue because shielded multi-sig isn’t a thing. And self-custody with hardware wallets is almost here, but its not here yet.

I think we all agree that the privacy and security afforded by Zcash through zero-knowledge is far superior than anything else out there. It’s the long term winner. More funding is available through ZOMG for fresh and interesting use cases, and I’m hoping that the Zcash foundation will soon release Zebrad and also be able to contribute more innovation to the protocol. Who out there is in a better position to innovate on this any faster than this community, aligned with this funding?

It’s my belief that adoption and transition to zadders will come with time as the tools become more accessible and user friendly, the cryptography gets better, and the user and 3rd party developer community increasingly sees that the Zcash shield is necessary, as much as the HTTP shield is necessary. In fact, I think it will soon accelerate. It could move even quicker if BTC’s lack of privacy proves to be a liability in some high profile way.

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@secparam I really, really like what you’re saying here.

I don’t think “has lost its way” is the right label for this though, because they’re clearly doing huge amounts of work with privacy as the end goal.

I’d put it as “could/should be more maniacally focused on privacy,” and “could do better at making this passionate, maniacal focus clear to potential users and observers in the blockchain space.”

And I think to be fair to ZF and ECC it’s really hard to maintain both this maniacal focus and communicate it well to the broader community while living in the gnarly details of making all this stuff work. Like, it’s easier for outsiders to observe this than insiders, you know?

I’d love to talk about this on voice sometime and get synced up.

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As far as ZOMG goes, I’d love to talk about how we (or at least I) can be maniacally focused on privacy and communicate this as well as possible.

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I’d also point out that one of the wishlist items I’ve seen repeated the most often by community members is stablecoins. How would you evaluate those within this rubric of “it’s about privacy, stupid”?

It’s tricky, right? If we’re talking about people we know using Zcash to protect the privacy of their economic life, they probably need the option of a stablecoin.

But it’s not directly related to making Zcash as it stands now more private, so strictly speaking it’s a distraction.

Hardware wallet support is another example.

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This is good but with taddr-zaddr thing, why did ECC prioritize Gemini’s shielded withdrawal? What purpose did it serve? For those who need privacy, then can always move it z-addr (by ECC’s logic, right?) Why did community even celebrate this. I hope ECC sees the point we’re all trying to make.

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private stablecoin so i guess that falls under privacy?

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@joshs @zooko

There is no doubt about the efforts ECC team is putting with resources that are available. What’s surprising is ECC’s support of t-addr & t-z ecosystem as long term strategy. It was fine as a short term strategy.

Fundamentally, there is a difference b/n ECC’s plan & strategy vs what most of us here are looking for.

ECC wants to have more ZEC in shielded pool, more z2z transactions, right? (correct me if I’m wrong).

Can ECC leadership team answer questions:

  1. I guess the bottleneck there would be exchanges storing ZEC in t-addr. Does ECC intend to push exchanges to store ZEC in shielded pool? is ECC fine as long as all users store ZEC in shielded pool on their wallets or hardware devices?

  2. Does ECC support disabling t2t transactions?

  3. Everyone agrees that it didn’t make sense to promote z-addr for technical reasons. We have wallets that make shielded transactions possible, ledger z support underway, possibly shielded multisig, viewkey support in sometime. How does ECC plan to promote z-addr storage? What are the strategies? (At this point, I won’t be surprised if it involved no protocol change to enable that).

  4. What’s the role of t-addr in Zcash ecosystem?

  5. What would ECC do when shielded usage doesn’t go significantly up even after making shielded tech available?

  6. Winning users is not easy, the value proposition needs to be simple. Right now, majority of transactions are transparent. Does ECC have any action plan to organically reduce transparent transactions?

  7. What does ECC think about users with perception that Zcash is not private? There is no point in scaling the blockchain if users who care about privately storing & transacting wouldn’t use Zcash (ex: immediate user growth will come from active users of Monero).

  8. As you (ECC) can clearly see, members within Zcash community doesn’t agree keeping t-addr “forever”, also fully transparent transactions. Can ECC make an official stance on this? See Ian’s question: Leap frogging zaddr - #367 by secparam

  9. If ZF poll turns out differently than what ECC intend to do, would ECC make appropriate software change (similar to the way we did with dev fund).

  10. With the way, the conversations were happening, it is easy to question where the power lies. Good or bad, Would ECC plan to support changes that it doesn’t fully agree?

  11. Does ECC intend to co-own Zcash trademark in perpetuity? I think releasing it would further support decentralization.

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  • Can we follow up with:

  1. Agree that majority of ZEC being stored in T-addresses = under-utilization of Zcash network?

  2. If we’re keeping T-addrs around medium-to-long term, treat T-addresses strictly as a bridge between other blockchains and prioritize Z-address usage everywhere. (But really, other blockchains should use a Z-address SDK to deal with Zcash on a smart contract in whichever VM they’re running on).

  3. Work on incentivizing ZEC held in T-addresses to move to Zcash shielded Z-addresses? (without complicating on-chain use wrt transaction fees).

  4. Look in to the proposal to simply charge a 1% fee for funds held in T-addrs and provide that 1% as interest for funds held in Z-addresses? per A modest proposal: squeeze out taddrs - #68 by zooko

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Hi
@holmesworcester we should talk on voice. I just DMed you.

Let me ask you a question: If your house is slowly flooding, can you make a sandwich if you’re hungry? I’d say you can make a sandwich, but don’t claim its going to fix your obvious major problem.

The point wasn’t what ECC has done, its that the community as a whole has lost perspective. Even if what ECC is working on is good and a good use of resources (and e.g. scale IMHO clearly isn’t medium term since we don’t have users or a way to get them), they don’t solve the larger problems we have. There’s this feeling amongst everyone, ECC included, that something needs to change with Zcash. But the changes we as a community talk about clearly won’t fix the problem we all see. Fine, some of them are good, but if we delude ourselves into thinking they address the slump we’re in, then we won’t ever do something that actually solves it. We won’t even look.
thats what i meant here

Second, stable coins would be exactly something thats about privacy. It uses Zcash as a platform to bring privacy to others. It would get us attention. And it plays to our cryptographic strengths. There’s no ambiguity. It’s exactly the kind of thing we 1) should do 2) should talk about and view as actually helping to fix our adoption problem.

Hardware wallets are different. It’s like a sandwich to feed you while you fix the house. They are a thing we should do, but they are a supporting thing. And in fact everyone would look at you like you were crazy if you said hardware wallets solve zec’s slumped adoption.

Does that make sense what i was getting at?

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Sorry, but I have already written so much about this on this forum, and thanks to what you started to act so actively? I write after analyzing the network indicators (the number of wallets, transfers, storage, price, and after the controversial, in my opinion, statements of various officials). Why did you see now and not 2 years ago that the project is going in the wrong direction and is deprived of the prospects for widespread adoption? We will not get answers to other questions anyway, so we can find out the essence of the problem on our own.

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If there is anything that kills Zcash. It will be optional privacy, not hidden inflation.

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Default Shielded, Optional Transparency. This is the way.

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In the end, we all want massive use of z transations compared to t2t, and ideally t2t disappearance. I still think it’s about what we build on top of the protocol part that will make it move that way.
Forcing people to go one way never really work. People don’t like change being forced at them. We need to make people understand the need and change themselves.
Anything that is built on top of the Zcash protocol should make the z transaction the default or easier and better choice.
@nathan-at-least had a good example of such a success: Signal.

By the way, does anyone now more about how people started to transition from http to https?
(By the way, I guess http still exists, but the browsers now shift to https by default).

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Can we all agree that at this point the ECC and ZF should stop spending money on T address related development?

Our goal is to decentralize Zcash so we can’t stop 3rd party developers from doing things the protocol currently allows

We can stop spending ZEC that was diverted from miners to fund Zcash development on things that are making Zcash weaker (T address development activity by)

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