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.)
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.
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.
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?
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.
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…
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. 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!
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…
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
I know @acityinohio has thoughts in this area, however.
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.
@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.
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…
+1. ECC needs funding, and so does the foundation.
Initial investors and founders however, do not. That time has run its course.
In fact, that is really the only truly contentious aspect of the allocations continued existence imo.
Why should ECC have funding on the backs of the miners when they could be mining themselves to align their incentives rightly? The ZFND could just as easily take over R&D and hire the founders
Mining is labor (and location) intensive for one, and incentives do align when your sole source of funding is the thing that you are trying to add value to. See: positive feedback loops.
I still don’t understand why you want to give ECC more free money (without protecting the network and mining themselves) instead of the non-profit foundation who could just as easily perform that function with that same money…
Right, but what if the Foundation was the recipient of the new dev fund and then entered into contracts with ECC (and others) to continue research and development? I agree that “decentralization” of the dev fund recipients is of paramount importance with multiple developers/orgs so as not to be solely reliant on ECC. It’s then up to good governance to ensure the Foundation doesn’t become evil and allocates the funds strategically.
As mentioned earlier, both the ECC and the fund should make a proposal for further funding, and then discuss it with us. It turns out that Zooko and the rest of the founders will talk with the right people from the community and decide how it was with ASIC.
Makes someone again wonder why nobody thought about this earlier. The FR expires in 17 months and you need 16 months…
No doubt. Just ouf of curiousity, why wasn’t this mentioned allready in the beginning that the FR could be extended, changed, whatever in case 4 years FR are not enough to finish the product?
Nice wording. I’am not sure if there is currently anything decentralized at Zcash. The wording less centralized would fit much better, but seems riding the decentralized wave is choosen to make it more popular.
Means fully open source or how to understand this?
What? A sudden it needs decentralized decisions? The first really decentralized decision in Zcash history has to be the development fund decision? If this statement would be made by the foundation i would give it some benefit but from the ECC company that has no history in decentralized decision this sounds more than strange.
Isn’t this exactly what you are doing right now your own? Even unwilling to shift internally funds of the FR to secure development and/or building up some development reserve funds? From an estiminated $300,000,000 Founders Reward by 2020 not a single dollar shifting initiative?
Out of curiousity, what’s decentralized so far? I have a hard time to find anything decentralized at the moment… What i’am missing.
Having allready an example in the history with the asics discussion i agree with this. Someone can indeed expect it will be like this.
And just some side notes:
- Seems Ycash initiative was right about the extended/changed Founders Reward.
- I was absolutly right that the suggestion/proposal of shifting internal funds within the Founders Reward is absolutly tabu.
- Zero initiative/contribution on the topic from the foundation, makes you wonder why we have them at all…
This makes the most sense to me - funding should flow through the Foundation.
There should always be a time limit on funding streams to ensure the recipients cant become complacent or corrupt.
Think this discussion needs to be led by the Foundation, perhaps as if they are applying for the job.
Hi, just a quick reply. I think this is a pretty dangerous move. It makes the ECC the centralising force, both in terms of the Proof of Work/technology and network .they then become the absolute arbiters of the coin, network and trademark.
The idea is that since the FR is ending we /might/ need to find an alternative method for funding research.
Does the ECC have alternate revenue streams apart from the FR? We don’t know, they don’t publish that info afaik.
I’d be surprised if they don’t, support contracts with exchanges is an obvious guess. Lets ask @zooko !