I am starting an independent, Swiss-based organization called Shielded Labs to help Zcash decentralize and become more resilient. Shielded Labs was founded as a Swiss Association in December, and I’m currently working to secure funding and recruit knowledgeable and experienced individuals to join me as board members. Shielded Labs has no affiliation with Zcash Community Grants (ZCG) and has no plans to apply for ZCG funding.
There are two reasons I’ve decided to start a new organization. First, Zcash is currently supported by two US organizations, the Electric Coin Company (ECC) and Zcash Foundation, that are the sole recipients of the development fund. ZCG is not an organization, but a grants committee under the Foundation, which custodies and administers its funds. I strongly believe we need more independent organizations contributing to the Zcash ecosystem in order to diffuse power and become more decentralized.
Second, Zcash is building critical privacy-protecting financial infrastructure, and there’s a risk that the work being done could be hindered by regulation. In particular, Zcash’s exposure to the US is a potential single point of failure, and we need to urgently build an ecosystem that is resistant to capture. Above all else, my goal is for Shielded Labs to make Zcash more resilient. Shielded Labs is domiciled in Switzerland because it’s a country that is both crypto-friendly and has a long history of preserving privacy rights.
Vision
Shielded Labs aims to increase user adoption, develop new use cases for Zcash, and contribute to protocol development. Below is an overview of four areas of strategic focus. Please note that these are intentionally broad. I will provide more details about specific projects in the coming months.
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Narrative Development: Crypto is driven by narratives that create a sense of community and shared purpose among stakeholders. There are many faces to Zcash: it is a technology that protects individuals’ economic and social freedom, a tool against financial surveillance and authoritarianism, and a private store of value and medium of exchange. Shielded Labs will explore themes around privacy, censorship resistance, and Zcash as digital cash. It will tell stories about what’s changing with the protocol and why it matters, and develop and spread coherent narratives focused on Zcash’s unique identity and values.
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User Adoption: Shielded Labs will work to increase user adoption by getting Zcash listed on more exchanges, working with companies on payments integration, and increasing Zcash’s availability on DEXs and Defi applications. It will prioritize projects that advance the usability of Zcash, such as Zcash Shielded Assets, and support the development of bridges, AMMs, and fiat on/off-ramps.
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Human Rights and Freedom: Over the past year, there have been a number of events happening in the world where Zcash could help. For example, Canadian truckers cut off from the financial system and Russian activists who face political threats at home for trying to help friends and family in Ukraine could leverage Zcash for support. Shielded Labs will partner with human rights and civil liberties organizations to get Zcash into the hands of those who need it the most.
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Protocol Development: Currently, protocol development is handled by two US organizations, which is a risk in the current regulatory environment. To date, all network upgrades have been implemented by ECC. Resilience requires decentralization, and Shielded Labs will help Zcash decentralize by contributing to core protocol development.
Launch
At launch, I’d like to focus on a few small projects that will have a significant impact and set the organization up for future success. One idea I’m exploring is for Shielded Labs to develop and support the Posterity/Sustainability Fund, which is an important step for long-term network sustainability and future economic upgrades like a transition to proof of stake and Zcash Shielded Assets.
Shielded Labs would hire an engineer to develop the modified issuance schedule and the mechanism to direct funds to the Sustainability Fund into a proof of concept and implement it into zcashd or zebrad. Shielded Labs would fork the Zcash GitHub repository, implement the new source code, and create a pull request for a merge. Assuming it has sufficient funding and developer resources, Shielded Labs would be responsible for ongoing support as the maintainer of the forked codebase repository.
What’s really powerful about this is it would be the first time a network upgrade was initiated by an independent developer and it would demonstrate that Zcash is truly a permissionless network. In addition, Shielded Labs would help lower the barrier to entry for serious development projects so that developers don’t have to go through the ECC pipeline, which is already maxed out.
I would oversee the project and navigate any governance issues that arise. I’d also start to build out the other initiatives I mentioned above related to narrative development, user adoption, and use cases around human rights and freedom. I would initially hire part-time, project-based support to help me lay the groundwork for the organization to grow.
Funding
At the start, Shielded Labs will be funded entirely by donations. I’m currently working on raising enough funds to bootstrap the first year of operations. I’m speaking with a few potential donors, and one has already committed to providing partial funding. Of course, there is always a risk that funding commitments do not materialize; however, I’ve received enough interest and support that I am optimistic that funds can be raised.
With regard to long-term funding, my objective is for Shielded Labs to be a recipient of Zcash’s development fund via the block reward after the next halving in Q4 2024. To be clear, I do not want Shielded Labs to receive direct funding from ZCG’s allocation of the development fund. Instead, when the time comes to revisit the development fund and determine how it gets allocated, I hope Shielded Labs will be considered to receive its own, independent slice. In order for that to occur, Shielded Labs must first prove itself as an essential part of the Zcash ecosystem.
Conclusion
Starting an organization from scratch is a daunting endeavor, and one that requires significant time to gain momentum. It will likely take me a month or two to get Shielded Labs up and running. Things may move slower than expected at times, and I might make mistakes along the way, so I ask for your patience, understanding, and support. I will use this thread to provide periodic updates to the community.
I believe Shielded Labs’ presence in the ecosystem will complement ECC and the Foundation. While there may be some overlap or redundancy, Shielded Labs will primarily focus on things Zcash needs, but the other two organizations have not prioritized because they don’t have the bandwidth or resources, or cannot prioritize because they are US 501c3 organizations. A lot of work needs to be done for Zcash to appeal to a larger audience and achieve adoption. Ten years from now, my hope is that Shielded Labs is just one of many vibrant organizations around the world independently contributing to the success of Zcash.
Thank you,
Jason McGee
If you’d like to donate to Shielded Labs, please contribute to the addresses below.
ZEC: zs1nldqn9g8wfpwuz3mj9y95y8fq8snnmukp8lk4lpdu5jmcrhkxejnv6q5yz6p3zrz0mkjw0w57rl
ZEC (UA): u1v9tszkh36ckmamgx4mhssm0pp08xcccgehrpcvxq4pt478e9self2tjnpl2xgt47gwn0dhmdaecr2x3ycguuc6ueparttmueexterv92yxlj7utvzfcgzvufxwnnzzp4s8pg4slj9w33es833glkq0pk64ljjapfxyde06qg2rpm7hk27ugyc9m88vz0vze2v9guh8vsk7dl5de9v4a
ETH: 0x563a6aD50e53CB4850fA3693128f21Cd0dA85F64
