So What’cha Want? ECC Update (funding edition)

Ecosystem Updates
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Hi Zeeps,

Time to get real. ECC needs you to make a decision.

I resigned from ECC in 2023 to call for change. I argued that those changes included killing the direct development funding model, dissolving the trademark agreement, cross-ecosystem collaboration, building a strong UX for ZEC including a wallet with good UX and hardware support, and driving partnerships that expand the reach of ZEC.

When the Bootstrap board of directors (ECC parent org) hired me back as the CEO, I committed to doing these things, along with rebooting ECC’s culture, to help drive Zcash forward. For the world to have “unstoppable money,” we must win. And these were foundational pieces for a winning path forward.

With the support and dedication of an incredibly talented team at ECC, we executed on many of these things over the last year. In the best interest of a thriving Zcash (but not necessarily ECC’s financial interests), we worked with the community to kill the direct funding model, dissolved the trademark agreement, delivered Zashi and hardware support, and built coalitions with other communities. We opened up ECC’s culture, and we delivered. We’re now in a new era for Zcash, and it is still rapidly evolving.

Now that we’ve accomplished these foundational changes, we face a critical funding decision that will determine ECC’s future and the future of Zcash.

We have much more to do to deliver a complete vertically integrated stack for Zcash that scales, people love, and delivers multi-generational freedom through the world’s most secure and private protocol and tooling. For a more detailed breakdown of ECC’s vision and planned initiatives, check out this update: Onward in 2025 - ECCUpdate and current roadmap.

It’s time to decide if you believe in and want to continue supporting our work.

The following is our current funding position:

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As you can see, our funding will run out this year. We were at two years of funding just a month ago, but the recent price drop reduced our runway by over a year. If the market remains as it is, ECC remains as it is, and we don’t receive funding, we’ll be out of money before the end of this year. From the outset, we decided to align ourselves with the interests of ZEC holders by minimizing our ZEC sales as much as possible and choosing to accelerate delivery rather than hold funds for self-preservation.

In the coming weeks, we will ask you to make decisions. It’s in your hands.

Decision 1: Do you want the lockbox to continue to receive funds beyond November 2025?
Decision 2: Do you want to open the lockbox in 2025 so ECC can apply for funding?
Decision 3: Which of the proposals will be adopted for how funds will be allocated?
Decision 4: Do you want to fund the grants we apply for?

The first two decisions must be made soon so we can plan accordingly. The third and fourth decisions are only materially relevant if you want to continue to fund our work.

Please be aware that implementing the means to distribute funds in 2025 could impact NU7 timelines. This doesn’t mean it would, but it is a risk you should consider. Changes to ECC operations could also impact NU7 timelines, as we will not be fully funded to continue as-is.

I have surfaced two proposals that we are writing up into ZIPs. Other ideas have been floated, and I welcome others to also codify them into ZIPs for polling. I would like to start polling right after ZconIV in early March.

I advocate for the Community + Coin Holder Funding Model, which aligns funding and coin holder​​ economic incentives but allows a veto for implementing undesirable changes. I find arguments like this compelling. It seems to have good support here and from those of you who reached out to me directly. But it’s what you say in the polls that will matter.

It’s in your hands, Zeeps. So What’cha Want?

Here’s what we delivered this week:

Zashi (@Andrea)

Zashi Design (Pablo)

  • Onboarding Redesign:
    • Continued revisions for Seed Phrase Backup, Restore and Create Wallet flows
    • App Home Screen (Empty State and Seed Phrase Backup banner)
  • Adhoc stakeholder and engineering edits and improvements
  • Adjustments to Advanced Settings and Tax Data Export designs

Q&A and Dev Support (@decentralistdan)

  • Testing iOS & Android internal builds
  • Tested FOSS Android build (F-droid) - QR scanning, & Keystone scanning
  • User Support: Discord, X, & Email
  • Zashi Website planning
  • Zashi Release Comms
  • Zashi Socials & Content Creations

Zashi iOS (@Lukas)

  • Released 1.3.3 with fixes, optimizations and improvements around Keystone & Reset of Zashi
  • Investigated Seed Backup options for iOS, see here
    • local vs. remote storage, availability, cross-device vs. cross-platform syncs, cons & pros
    • 3rd party options like 1password, etc.
  • Participated in interviewing Core Team candidate
  • Prepared per account user metadata data storage, waiting on encryption
  • Bug troubleshooting:
    • missing sapling params for the Keystone transactions
    • crashes of the BGTask
  • Implemented Keystone UI/UX improvements for canceling and rejecting a transaction + added a new confirmation step
  • WIP: Near Intents research spike, stay tuned :nerd_face:

Analytics Update:
Unique Installs: 6.39k
Total Downloads: 7.58k
AppStore Rating: 4.9*

Zashi Android (Milan)

  • Added FOSS build environment for F-droid
  • Added mechanism to remove and override non-open source libraries
  • Removed non-open-source libraries for F-droid (FOSS build only)
  • Working with @Yasser on GitHub releases which will allow us to distribute the .apk file directly
  • Implemented Keystone UI/UX improvements for canceling and rejecting a transaction + added a new confirmation step
  • WIP: F-droid publishing and build - encountering some issues

Analytics Update:
Total Install Base: 3.49k
Total Installs (incl. Open Beta): 14.4k
PlayStore Rating: 4.477*

Zcash Core (@nuttycom)

  • The core team did a lot of specification work this week, including ZIP editing for NU7 and an update to ZIP 32 to replace the “Arbitrary Key Derivation” spec with “Registered Child Key Derivation” which will be used in the encryption of wallet metadata. This standard will be used in a future release of the Keystone Zashi firmware to enable the encryption of wallet metadata for a Keystone-based account, without relying on any keys that can’t be recovered from the Keystone seed.
  • @str4d set up comprehensive CI infrastructure for the Zallet codebase & fixed some outstanding CI issues in the light client FFI repository.
  • Transparent gap limit handling code is now functionally complete.
  • Str4d migrated the Android and Swift SDKs to the latest versions of the Rust crates in preparation for the next Zashi release. As part of this, important new capabilities have been added:
    • Support for PCZT pruning to reduce the bandwidth necessary for communication between the wallet and the Keystone device & to allow transactions with more inputs and outputs to be created with Keystone. Also, a bug that caused an error in creating proofs when constructing transactions via PCZT due to missing proving parameters has been fixed.
    • Support for lightwalletd transaction submission and retrieval to be performed over TOR. This helps to fix a longstanding privacy risk for users of mobile wallets.
    • Other features required for UI improvements (better representation for shielding transactions.)
  • Kris led a community walkthrough of the librustzcash crate stack.
  • Str4d finished up some long-running work on the equihash crate, which unblocks the ZF team for adding internal (testnet) miner functionality to Zebrad.
  • Current in-progress work includes implementation of the Registered Child Key Derivation protocol in the Rust crates, and fixing a longstanding note commitment tree corruption bug.

Other

Product Marketing: @peacemonger completed the ZURE and ZAC surveys and initial user interviews for Zashi Vault. These efforts yielded strong insights. More on that in the coming weeks. Oh, and a community-wide survey is coming out next week. We hope to hear from you!

We’re actively interviewing for a Strategic Marketing Manager and making good progress.

Dan has been coordinating with the ZF on ZconVI, and supporting comms, including the new DEX provided by NEAR.

The Bootstrap met for our quarterly meeting and reviewed financials and plans.

@aquietinvestor, @_jon, and I began regular meetings to plan for the launch of ZSAs into the market. The primary focus is collaboration to promote ZSAs to potential issuers. We also met with Tether, thanks to an introduction from another Zeep. While a bit of a long shot, we’re still pursuing a path.

I drafted, got input on, and posted the Community + Coin Holder Funding model.

That’s all for this week.

Keeping it real.

Onward.

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Personnaly I think that interrupting funding to the Zcash OG’s can turn out to be a huge mistake. But it also comes with a price: short time pain for long term gain.

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i always believed that ECC should be strong (financed by the community).
only concern always was that they are doing mistake after mistake.
now when a new ECC arrived and delivering, ending funding is not fair and even stupid.

the goal is to finish zcashd deprecation asap, and then have a strong team that can collaborate with other team, to build interesting projects.
is it possible without a funding model?

all the projects today are pre-mined, and no one cares that founders take more than 50% of the tokens…
what is the challenge with continuing giving ECC and Foundation 15% of mined tokens ?

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Simply put I would like you to build a product or service that doesn’t involve selling Zec. Maybe a vpn or a private email or even private AI if that’s even possible. The whole tragedy of the commons/public goods narrative hasn’t worked for 8 years so why continue?

Also, more generally for those reading… what is Zec/Zcash? A network state, commodity, security, cybercash?

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i think it can happen only after deprecation of zcashd and a stable release of Zebra, that institutions can integrate easily and not worry too much about its breaking from time to time.

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I think the question needs to be, does ECC need funding at the current level? When I see Josh say we are “actively interviewing” for a management level position but going to run out of money this year, there’s a big disconnect.

Why not take a hard look at the people currently in place and what functions ECC really should be doing? It all fell apart the last time because ECC tried to do too much and it feels like you’re in the same spot again.

Trim things down, focus on delivering a good product and worry about the marketing manager later. I’m all for funding good work, but how many managers do you need to support a small organization?

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We won’t hire if we don’t have a path to sufficient funding. All incremental and discretionary expenses are currently on hold. We don’t employ anyone that isn’t a doer.

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The community is forced to constantly be in a role that can be compared to an inexperienced trader who makes his financial decisions based only on the latest news. This is because few executives in Zcash have been able to figure out how long-term pricing works in PoW cryptocurrencies. Sadly.

I’m all time ready to support the major teams with my vote. But we must not succumb to panic every time the market slaps. We get up and move on. If we don’t have confidence in ZEC as an asset, what’s the point of all this in the first place? All these innovations and user experience improvements don’t make any sense for Zcash, unless we’re sure it should be much stronger than $30 a piece after two f*cking issue halvings.

If there is to be a vote, it should have some input parameters.
“Do you want to open the lockbox in 2025 so ECC can apply for funding if the ZEC price is below the N price on average for 10 months”,

where N is a reasonable economic cost with a transparent structure so that I can understand what composition of positions I am voting on and why.

Give me the input parameters. Not just a table with costs I know nothing about inside. If we’re a transparent community, we should probably have tables like the ones ZCG has for areas of work. So that there is an understanding of all these modules. I realize that this is not easy qestion, but at least not by persons, but by areas of work.

You know, when people ask me if we should finance the construction of a house, there are a lot of questions. Let’s say I understand that I need a house in this city, and I even understand the neighborhood. But how many floors, how many rooms? I don’t need the material of the window frames, it’s all +/-, but the basic parameters will affect the cost of this task.

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This is correct. The zcash community has a unique moment to ask ECc some hard questions.
What sources of revenue are available?
How many customers are willing to pay for your services?
What core service differentiates you in the market?
What happens if the house is not financed?

I’ve been struggling to understand for the last two years what are ECC core strengths, historically its been the engineering skills required to maintain zcashd, zcash protocol edits an ability to response to required updates. If zcashd is dead, ecc is just a wallet application, is it still necessary to receive core funds directly from the zcash block generation?
If ECC bleeds out can the ecosystem survive with one less application?
Does zashi have the user base to generate enough revenue to sustain the current staff levels, let a lone that huge liability of 3.5 million outstanding debt on the balance sheet?
Has ECC positioned itself so the ecosystem needs its unique skill sets?

Unless zashi grows like a hockey stick? Maybe resources are not aligned in a manner that deserves direct funding any more. Why should the direct funding not go to one of ten other zec application developers with the same volume of users?

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I’m not questioning it so radically, because a lot of things the community is funding for potentially widespread use, even when right now it doesn’t look that way.

But then I need to be specific about what exactly I don’t like. I don’t like it when we generalize to say “we need it and we vote for it”. But then the model is that this organization manages the money as it sees fit and we have no way of even knowing what is inside beforehand. I’m not accusing anyone, it’s just a fact that investments in other projects didn’t meet expectations and didn’t help Zcash to get out of the situation that it can’t exist without a development fund. The fact is that these decisions were made without community participation. I don’t like any sponsorship from ECC. For example, the car raffle has no useful effect on the community. At least we are not asked about it. So there’s some causal disconnect at this point in the sources of the funds, which are sort of a decentralized solution. And in the purpose of these funds, which are spent without taking into account the community’s opinion. That’s where my problem is.

I don’t like this movement of significant money from under the decisions of the community to the sole prerogative of the decisions of individuals I trust a lot, but this system itself is what Zcash have hating from by other communities. And that’s what I don’t like the most. I don’t even have anything to say to that.

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ok. what i want?

  • to see Zcash start thriving after years of building.

  • Zcash needs 1 wallet to onboard new users(privacy gigachads) to the best privacy UX in the space(hard)

  • im not sure how much additional funding(@ current levels) would help given the size of lockbox(not using 100% of it)

  • reduce costs if possible and find outside resources somehow to keep going and deliver Zcashd deprecation and NU7 in reasonable time.

btw. after Zcashd deprecation. how are developer resources being redistributed when we will have Zebra?

i have too many question and not enough answers.

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I’ll clarify this thing.

When we use ZEC to cover our costs below the payback bar of the miners we make ZEC mining extremely unattractive. In fact, right now it is more profitable to buy ASICs for dogecoin (major profit) + Litecoin (very low profit), they are mined in a pair at the same time. That’s why the litecoin hashrate has almost tripled in the last year, while the Zcash hashrate is at 2020 levels. That’s one of the reasons why miners sell at low prices. They know that if they don’t do it, the dev fund will.

Right now, the $30 price for mining is extremely unfavorable. This is equivalent to the price of mining at $15 before halving.

So we should not build an economy based on a $30 price tag. We should look for any way to avoid it.

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Trim the fat by dissolving ZF and merging everything into ECC, then convert all of ZF’s BTC into ZEC.

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The funniest part is, ECC is still hiring a marketing expert, yet they don’t realize that if ZF converted all its BTC into ZEC, it would be the best marketing strategy ever. They keep making the same mistakes over and over!!! You know how embarrassing ZEC’s price is, do you still not see what you’re doing wrong?

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NU6

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I want to remind the commuinity the Hybrid Deferred Dev Fund was temporary and not suppose to be extended. As I’ve already stated:

Now is not the time to kick the can and get more of the same. We need to follow through with what the community wanted:

a new non-direct funding model that aligns the funding of Zcash work with the wishes of the community.

Send everything to the Lockbox until we can decide.

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The objective, at least in my mind when I supported the proposal and voted, was to implement a distribution mechanism before Nov 2025.

Who is “we?”
That’s what we still need to solve for. Might be a good idea to take it to those with the most financial skin in the game.

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As a privacy project, I hope that only includes shielded funds. The longer they have been shielded, the better.

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I hold both shielded and unshielded funds due to opsec concerns and because we didn’t have hardware support until we delivered it last month.

Why should that affect the weight of my vote?

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Easy, aligned values. Why are we here? Opsec is better holding transparent coins? I’m not sure I follow that. ( Perhaps you can explain! )

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I’m not going to disclose the location of my ZEC, or the security precautions I’ve taken to protect myself. Some are shielded, some are not. Does that mean I’m not ideologically aligned?

I think its fine for coin holders, who for whatever reason haven’t shielded all their coins, but who are exposed to the coin price, to make decisions about where their money is going - both if and how they want to invest.

7 Likes