The future of Zcash in the year 2020

Hi Boxalex, it has been a while :slight_smile:

Err the addresses are baked into the codebase. Technically the algo gives out the rewards in exactly the same way as it gives out block rewards. This is why this cannot be changed. I know it sounds like a semantic argument because ECC can always change the addresses, but it really isn’t. it would be like them changing the block reward.

This raises a really interesting point I don’t think has been covered yet. maybe @garethtdavies or @str4d would know?

The reward is currently split 4 ways (actually 3, because the investors have already been paid out, although it ‘feels’ like 4 ways)

So the current operating costs of 700k a month would translate to 840k to keep things running as they are.

If a new fund is started, would it be a founders reward? Would it include previous investors and the Founders? What about advisors? Really imho the engineers and working staff (hr, pr, etc) are needed so this would greatly reduce the amount needed. It is not so much as cutting the chaff but releasing the booster rockets. The whole framing of this conversation as a continuation of the founders reward is misleading. I think zooko once spoke about a “dev fund” maybe use that term again?

It could also be argued that the investors, founders and advisors if they are left out of this fund are being enriched by the funds existence indirectly by the adoption of zec, improvement in tech and hopefully an increase in price. It would certainly be true that it would protect any current investment that they have.

To make this clear I am not advocating for any adjustment of anyones money that is already allocated and agreed upon. It was made painfully clear in the ASIC thread and the one about the founders rewards that zec is opt-in.

I do think it is slightly worrying for the project that people (not talking about anyone in particular, a lot of people are saying it) are calling for the engineers and staff to have their salaries changed. This is clearly unreasonable. It doesn’t matter how mismanaged you think the money has been, this is not the fault of the engineers nor majority of staff/founders reward recipients. This shows a huge disconnect from the community and engineers that wasn’t here last year.

This disconnect cannot be fixed by the community, it has to come from the ECC. It is all well and good us trying to crunch numbers, guess at things, etc. Can we have some leadership from the ECC instead please. You have all the numbers, risk analysis and development forecasts.

What are the realistic operating costs for post founders reward?

Anyway this is just my 2p. I will get back in my box now.
edit: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks” - maybe it is time for another shmorky cartoon zooko?

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I agree with you, it should be a new development fund and explicitly not an extension of the current Fouunder’s reward. It would start only after the existing Founders reward ends. I made that point here when Ycash was announced as I agree it’s misleading: Announcing Ycash, The First "Friendly Fork" of the Zcash Blockchain.

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24 posts were merged into an existing topic: Changing Zcashs Emission Curve

I agree, rewards should be given over a period of a year to ASIC miners, same as what was originally planned for GPU miners in Harmony mining.

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I believe that we should see the proposals from the representative, in which the goal, the task and the approximate calculation of financing will be announced, with an indication of what price zcash they are counting on, because it turns out as I already wrote earlier that they want 50 or more dollars for a coin but there will be 5 funding is still not enough. This price can be considered a fair price zcash.
Otherwise, as an investor zcash, I don’t care where they will take money after 2020, because it doesn’t matter to them that investors lose their investments in their coins, and don’t need to say that I didn’t calculate the prospect of a price drop, because there wouldn’t be me and such as I, they would not have worked up to the present moment, initial financing of $ 3 million would not be enough and if no one bought a coin and held it, the price would be about 10-15 dollars now.

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Just out of interest, why would the core development fund, have to come out of the block reward? wouldn’t it make more sense to tie it to transaction fees? This would seem to be a lot more inline with the continued success of zec because even when the block rewards run out there will still be development funds available.

The tech is good, this would provide massive incentive to increase adoption. and it wouldn’t upset the last of the miners, who lets face it, get the short end of the stick most of the time (be they asic or gpu miners).

I don’t mine zec. I would like to use it though, but only through shielded transactions.

I still wonder how much it would really take to keep zec running. I dont think it would be anywhere near the current 700k a month. It is a different stage of development, it shouldn’t require the same resources as the first 4 years. I still have a lot to catch up on so maybe all these numbers are out there, I just haven’t found them yet.

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Because tx fee’s wouldn’t be able to provide $800,000 / month funding so the team can push out incremental upgrades once a year.

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They don’t, it’s simply one suggestion. They don’t have to come from anywhere which is the status quo come the end of the Founder’s Reward in 2020. After listening to this Zero Knowledge podcast https://www.zeroknowledge.fm/77 it seems the Ethereum folks have been debating similar regarding block rewards and also transaction fees to the client developers (enforced by the protocol). I personally think block rewards are a nice solution.

Nothing. I am sure there would be people willing to work on it and maintain it at no cost. However, is that what we want? Zcash is clearly not in a “finished” state and requires a huge amount of research and development i.e. funding. Clearly, we need excellent oversight to ensure such funds are not misappropriated which is where I think the Foundation (and its board) play a key role.

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With Github Sponsors, there is no need for any kind of dev fund. Interested parties/individuals can fund particular ZIPs they are interested/invested in.

https://www.theverge.com/2019/5/23/18637344/github-sponsors-patreon-style-crowdfunding-open-source

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If the newly generated coins come from block reward, then it is a transfer of value from all coin-holders to the recipients.

(Reminder: what people are talking about here is how much of that transfer goes to miners vs. to founders vs. to devs. A different conversation on a different thread is whether the size of that transfer should be changed.)

If the coins come from transaction fees, then it is a transfer of value from all spenders to the recipients.

So the question is: should all coin-holders, or should all spenders, be the ones to fund a given thing?

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Everyone who is interested in the governance and funding of cryptocurrencies (especially Zcash!) has to read this article! https://increment.com/open-source/the-city-guide-to-open-source/ … (Even though it is nominally not about cryptocurrencies.)

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Hello, I do not agree with your statement. Why if from the block reward, is it a fee from coin holders? It is correct to say that this is a part of the total number of coins, I, as a holder, do not give anything, it’s probably correct to say that this is a fee for launching the network, it doesn’t matter how many coins are in motion and how many miners get them (let’s take the variant with 1 miner on 1 CPU) the reward will not change, and let all the coins be in one holder and the sum of these coins will also be the same as the value (they are not traded).
There are no questions about transaction fees.

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Hi Zooko,

It has been a long time and a lot has happened.
I am really glad that you are still reading and responding to the community. Thank you for taking the time to respond to my post.

How so? via inflation? - I dont think I fully understand what you mean by coin holders here. Would you please elaborate?

Is the implication that they community gives 2.5 zec of each block not the actual block finder? If that is what you are saying it is a very creative use of the word transfer. I suppose everyone in a way does indirectly give a portion of that 2.5zec but the miner directly gives 2.5zec - there is a massive difference in perception and finance.

We are talking about how to keep the project development funded via subsidy from the community after founders reward ends. This has nothing to do with any preexisting arrangement, but is how/what/if a new one is needed and what it might look like and where it comes from. - or was this not aimed at me?

Personal note: As far as I am concerned the Founders, Investors and the majority of the advisors have already received their monies. or will have by the time the FR runs out. I am calling this a development fund specifically because I do not think the Founders, Investors or Advisors need to be retained past the end of the FR. Although, there is not enough information in the transparency reports for me to make any kind of reasonable speculation on this though, so it is just a personal opinion from an outsider.

Coins holders? They should pay nothing. No one should have to pay to hold zec. If you mean miners, well i’d argue that miners have already paid 20% of their fees upfront (10% of the total zec supply). They got 20% less coins per block. Also they would be paying by receiving less fees, if transaction fees were used.

zec uses the btc model of fixed total issuance. A cornerstone of this model is once block rewards run out, transaction fees will keep the network going [if this idea fails, so does bitcoin]. This should be the model for financing future development past the founders reward in zec. If it works, it will work forever. If it doesnt work, the coin is dead anyway.

So yes, anyone who moves coins should have to subsidise development or the ecosystem will never be stable. As I said earlier taking a % of the block fees also does impact miners, they are getting less fees. this can be offset via higher transaction fees, but this could decrease volume, etc. I wont pretend to understand this, the economics behind it or really the game theory involved. This directly impacts all spenders/retailers and miners, which would seem to be the way to go.

cheers,

As a side note and unrelated, the phrasing of your question “should all coin-holders, or should all spenders, be the ones to fund a given thing?” leads to the only reasonable answer being coin-holders - this is because spenders are holders too, but holders aren’t necessarily spenders, so the question implies do we get everyone to do it or do we just get one group to do it. I know this wasn’t your intent so please clarify what you mean by holders and how they would fund zec. Or do you literally mean anyone that holds zec has to pay? like reverse Proof of Stake, or reverse interest in a bank account?

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I’m not even sure I support development funding from block rewards once the FR ends. But I am certain that if the community decides to do it, any further block reward funding should go to development only. FR investors (i.e. “founders”) absolutely should NOT receive any further funding once the FR ends… and neither are they obligated to any further funding. Period. Full-stop.

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Absolutly agree with this.

At the current exchange rate the Founders Reward will have created over 300M US$, $300,000,000, that’s a huge number. I think it’s a shame that we even have to discuss that the pure development funds are negative.
Seems the suggestion to make an internal re-distribution of the founders reward to shift more funds now and for the future to development gets totally ignored and avoided. Someone can only guess why?

  • Is it easier to shift responsibility to finish the project to the community?
  • Is it more profitable to shift the responsibility to finish the product to the community?
  • Is there not enough interest after everybody profiting from the founders reward got their money?
  • Is the lagging foundation only created to shift responsible at the FR end to them?
  • Is it uncomfortable for them to admit that they have a totally flawed and wrong distribution of ~$300M FR which even doesn’t garantee a finished product?

Amazingly there are still no plan A, plan B, plan C from the ECC neither from the Foundation. That’s amazing as soon the foundation will be in the same position or is the Foundation just ok to follow the NEM example and run out of funds resulting an a stall dive of NEM/XEM?

Without a fair solution that doesn’t put holders/believers/fan/small investors/miners into the position that they MUST fund development not to lose their own funds i just feel sorry for them. There are so many people here that believe with their heart in Zcash, especially the future of Zcash that it’s really sad to see what happens with development funding…

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Folks, I’m glad we’re talking about this! Thanks to Shawn, Gareth, Aristarchus, Howard, Vires_Num3ris, root, ChileBob, treasonous, dontbeevil, mistfpga, etc for bringing it up and posting thoughtful ideas.

I’ve been thinking about this a lot because, as Shawn correctly points out, we need to plan ahead. Not only does the Network Upgrade Pipeline require about sixteen months to develop and deploy changes to the protocol, and not only does the Electric Coin Company need a multi-year runway in order to plan and to continue our operations, but so do miners, partners, and potential partners like exchanges, wallets, OpenBazaar, etc. etc. Not to mention coin-holders! Everyone benefits from knowing what will happen at least a year in advance and being able to plan for it.

A couple of weeks ago in New York City at Blockchain Week, the Electric Coin Company had conversations with as many Zcash community members as we could. It ended up being about a dozen meetings (with individuals or organizations) with a broad swath of the pro-Zcash people in the cryptocurrency industry (none of whom are active on this forum). We talked with them about the evolution of Zcash, the cybercoins space in general, where we think we can best serve the interests of the community and the project, and asked them if they would support a new Dev Fund. The results were that there was clear and strong support from this set of people for ongoing funding of development of Zcash but that about half of the people also said that a new Dev Fund should be more decentralized.

What “more decentralized” means, exactly, of course is different things to different people, but the common theme is that about half the people — and also me personally — think it is important for the long-run future of Zcash that the next stage is less reliant on a single organization.

The biggest conclusions that I take from this is that Electric Coin Company cannot lead this discussion. No matter how broad the real community support is in favor of a given plan, if the Electric Coin Company was the one who originally proposed the plan and led the discussion, then observers from afar will (reasonably-enough) suspect that this wasn’t a real, organic, decentralized decision.

In order to communicate to the broader set of interested observers that what gets decided is a legitimate expression of community support, it’s going to be up to non-ECC-affiliated persons to lead the discussion. That’s why I’m so grateful to Shawn, Gareth, et al. that I mentioned above for starting the conversation and driving it forward already.

The hard part is going to be the “decision procedure”. Any and all proposals will face fierce and vocal opposition (and judging from my conversations in New York last week, the “do nothing and let development be defunded” option will be one of the most fiercely opposed of all!), so there must be some procedure by which the community decides to do a thing despite strong opposition.

The decision procedure also must allow for coordination — it has to allow a very large, very diverse set of people, each of who individually and privately support a given proposal, to find out that everyone else in the group also supports the same proposal, and to let everyone know that everyone else knows that everyone supports it. This is harder than you’d think. :slight_smile: For example, I estimate that about 95% of the people in that set — the set of people worldwide who have a major stake in Zcash either financially, in terms of their business plans, or in terms of their political and social convictions — are not reading this forum. So this forum has to be only the seed of the procedure.

Although the Electric Coin Company isn’t the right organization to lead the conversation, we stand ready to help and to answer any questions that we can. As our recent Transparency Report shows, we’re well-staffed, committed, and we consistently deliver world class R&D, engineering, security support, education, government outreach, partnership development, etc.

Again, I’m really grateful to the community members who’ve already stepped up to draw attention to this pivotal issue! It’s thanks to people like you that the Zcash project is further decentralizing and going to the next level in its mission!

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So NU4 will activate just as the FR ends…

If we don’t act, ECC should be totally excluded from the Founder’s Reward, right?

If so, good! They are a for-profit company! Here’s how ECC might profit while empowering the community:

Transition to an electric coin mining company.

By doing so, ECC helps protect the zcash network against centralizing forces.

Plus, to become profitable in this manner they must literally SELL zcash (or associated products that benefit zcash and its network). They must continue to enable the use of zcash as a for-profit electric coin mining company.

Moreover, for users, to “get a share of ECC” or a piece of the pie, we might simply join them in mining as they continue to develop the business. If ECC fails to develop the zcash, then their mining proceeds will be of no use to them as the zcash value proposition falters without the support of the Founder’s Reward.

During this time, ZFND takes over all rights to the Zcash logo, ZEC ticker symbol, and “Zcash” brand to prevent identity theft by a “don’t be evil” for-profit mining entity. Or, maybe some 2 of those 3.

Your thoughts appreciated. Please don’t make me ZIP this…

h/t: @boxalex @garethdavies @anton1 @dontbeevil @zecke @bus @mistfpga @chilebob @vires_num3ris @root

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I don’t think this plan works because then who does all the research and engineering that ECC does? If it ended up with the Zcash Foundation handling all of that, we’d be right back where we started, with a single point of failure :frowning:

I know @acityinohio has thoughts in this area, however.

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Thanks for getting some inertia on this subject with the post Zooko!

I’ve been thinking about the founders trilemma for some time now and one thing for this specific project strikes me.

I really don’t think that the ‘community’ (or whatever it may be called) will be receptive to a continuation of distributions of funds to founders. I would think 100% allocation to core development might be the only way to sell this while minimizing the risk of tainting the ethos of the project.

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@Morpheus I agree. [quote=“Morpheus, post:176, topic:32372”]
I really don’t think that the ‘community’ (or whatever it may be called) will be receptive to a continuation of distributions of funds to founders.
[/quote]

They founded the company. The associated fund has expired. It’s time to go big or go home!

Let ECC mine zcash and concurrently develop the business if they wants more z money out of thin air!

Don’t forget the users. Maybe they deserve an interest rate for saving their money in Zcash… Maybe that would inspire them to spend some zats around here…