I have read this whole thread and I now understand that I have been poorly treated by the ZCash team.
I naively thought that the Founder’s Reward would be used to fund development and marketing. This is not really what happened. The majority of the $250m raised has gone straight into the pockets of Zooko and 44 other individuals.
The excessive cash extraction by the founders has resulted in a death spiral. With so little money for development and marketing Zcash has progressed too slowly to compete with other coins. It is rational to assume that as insiders who are fully aware of this situation that the founders have been selling Zcash into the market which has been driving the price down. The person who gains most from this arrangement is Zooko who, to add insult to injury is now working on other project.
The Founder’s Reward is now coming to an end so the team has said that unless we find away to to continue to fund their under-performance they will go and work on other projects.
What should be done?
The fact that something is legal and transparent does not make it right. I am convinced that the original intentions of the Founder’s Reward were honourable. Unfortunately events conspired to make it a mechanism for transferring vast amounts of wealth from the many to the few.
It is for the 44 individuals who have benefited from the Founder’s Reward to commit to funding ZCash through to stability. It is likely that some - will take the money and run. The project will be better off without them. Those that stay will deserve our long-term support and respect.
Edited for tone 21/07/2019 after being flagged. Please see my next post for the facts that I used to support this analysis
I have taken the total amount of Founders Reward from Boxalex’s post in this thread which calculates it as $234m at that time.
I have taken the figure for the distribution between the ECC and the 44 from the transparency report and this post. This shows that founders and vested employees (the 44) take 64% (the majority) of the Founder Reward. This means that they have received $150m or ~ $3.4m each.
Many long term holders have seen a substantial decline in their investment, however the 44 are now rich (by any normal standard). I use this to justify my statement that the effect of the founder’s reward has been to transfer wealth from the many to the few.
The way that Jane Mercer was treated and the fact that the ECC has a monthly deficit supports my contention that too much weath is diverted to the 44 and not enough to development. [Moderation edit by @daira to correct Jane Mercer’s name.]
That Zooko has spent time advising other projects and is “absolutely maxed out” comes from his post https ://medium.com/@zooko/why-im-advising-tezos-a8e04ec1d0d4.
My statement that Zcash marketing has been ineffective is a widely held view in the community but I don’t have figures to either support or refute this viewpoint.
My statement that the people who have gained the most from Zcash so far ($3.4m each) are asking those who have not how they should be paid in future seems to supported by many of the comments in this thread itself.
My statement that the team has under-performed is based on the my belief that the $250m “spent” so far is a lot of money and my understanding of the road-map is that that Zcash is still far from having the features it needs to be a long-term private store of value. The very poor price performance may be an indication of a market perception that Zcash is not achieving its goals (although inflation is obviously a big factor).
If there are any factual errors above or if you disagree with this interpretation I would value your thoughts.
It not my intention to criticize anyone unfairly but as someone bought into Zcash because I believed in the vision I am disappointed that the project is failing not because of technical difficulties or the vagaries of the market but because, in my view, too much cash is being extracted.
Deductions from the block are prolonged (the percentage is calculated on the basis of further thoughts)
Recipients of the founders award in the period of the first 4 years donate part of their money to the fund for further financing of the project, thereby becoming investors, and returning their funds in the next 4 years in zcash currency, this will reduce the dissatisfaction of the first customers and the market as a whole, and make them interested further success.
The percentage of funding is calculated at the time of transfer in coins, not in dollars.
This will confirm the statement “all in zcash”
Can someone arrange this as a separate post as required by the rules?
Am I the only one who thinks it’s not really possible to make this decision (how the ECC and Zcash foundation gets funded) based on community input? This is the internet, and its good to hear people’s input and ideas, but this really seems like a decision for the Zcash Foundation.
The ECC has been transparent with the funds, and maybe they should get a consultant to look at their spending and see if there is a way to squeeze out a few more years based on the income that they know they will receive until 2020. This should probably happen soon. Maybe the founders should donate the last year of their rewards to the ECC if they really believe that is the key to success. I’m sure there are ways to get a few more years of solid development without the miners tax, and the decision could actually have a significant impact on price in either direction, so less might be more in the long run.
Welcome the forums!
The Zcash Foundation Board of Directors will have the final decision (historically, the likelihood of them siding with the communities’ decision is pretty high)
Second, Andy Murray CFO discusses the transparency report at about 13:00 here so he’d probably be the one to talk to about that :shrug: Electric Coin Company 2019 Q2 Livestream - YouTube
Beyond that you should probably research more about how things work, pretty much every important link can be reached through here ; ) https://z.cash
With the Founders’ Reward ending in 2020, my recommendation is that the Electric Coin Company (ECC) pursue a two-year strategy change to prioritize vertical integration of the Zcash ecosystem. As part of this, the ECC should continue its responsibilities for maintaining the Zcash protocol, however shift its core focus and emphasis to prioritizing distribution for Zcash-compatible wallets, acquiring companies that are complementary to Zcash & enabling the vision of the ECC, and normalizing privacy for consumers and enterprises.
This transition strategy may require substantial changes to leadership within the ECC to enable the vision to come to fruition. The ECC should consider developing or acquiring technologies to complement the Zcash protocol, such as – private custom assets, private smart contracts, layer-two privacy, network-level privacy, and private consumer & enterprise wallets. Vertical integration at a time when digital and financial privacy are at the forefront of enterprises and governments alike allows the ECC to set precedence and demonstrate how privacy should be incorporated into the digital world.
Protocol-based funding has been and remains a controversial narrative, causing unnecessary confusion and dissent within our small and growing ecosystem. I believe if the ECC takes the necessary steps to enable the aforementioned transition strategy, it will have the ability to pursue and raise a new round of capital using a traditional funding model. The integration of technology stacks beyond merely the Zcash protocol provides new avenues for revenue and affords new growth opportunities in consumer and enterprise verticals.
Lastly, we should acknowledge the ECC for launching and advancing the Zcash protocol, clearing regulatory hurdles for building decentralized and privacy-preserving protocols, and fighting for digital and financial privacy. It is rare to have such a collection of highly-skilled and like-minded technical talent in one organization, and it should be our duty to assist the ECC in pursuing its next steps, regardless of its decision.
I’m only for continued funding of ECC / ZF if it means also slowing down the inflation rate (more than the halving already would), while still keeping the 21mm total supply.
Howard Wu, thank you very much for contributing your thoughts about this. I know you as a very smart, thoughtful, and well-informed person in the space, and one of the few people I know who is active in both science and in VC-style investment.
I want to make one clarifying point about your proposal:
I just want to point out that, while ECC could do this, if we did so we would not be able to continue focusing primarily on improving, supporting, and promoting the core Zcash protocol the way we have been. We would instead need to prioritise the needs of the customers we would be acquiring (e.g. paying users of paid-for wallets, enterprise customers of vertical integrations, etc.) over the needs of all ZEC-holders (e.g. improving the core Zcash protocol, marketing Zcash to all users of the world, government and regulatory outreach and education, etc.).
This approach is an example of the “Pivot” option out of the three options that I described in my talk at Zcon1 (State of Electric Coin Company - Zooko Wilcox - YouTube). (The other two options are “Slow Down” and “All In On ZEC”.)
As of Zcon1, ECC has committed to not exploring the “Pivot” option for the time being. As I described in that speech, we currently have at least 24 months of sustainable funding under our current model, and as long as we continue to have more than 12 months of sustainable funding we are going to stick with the “All In On ZEC” option.
I was just re-reading the whole thread and these parts got my attention, especially the one about a voting mechanism catched my eye and mind again. Makes just … perfect sense.
However, for someone that is vehement against breaking of the 90% to miner promise and core value i don’t see much of contribution in any of the proposals, neither in these that stay to the promise, even less in these that want to break the promise.
Sure, you made your stance clear by a personal fork, but i wonder IF it should be limited to this as a ZEC holder? Just curious what the reasons about your silence is while on one hand claiming to be vehement against any breaking core value on the other hand not contributing to any proposal … Somehow at least … strange.
The ECC is ALL IN
I am ALL IN
We all know the state of things and now is no time for second guessing that or creating a distractive state for our devs
CONTINUED FUNDING!
I had not see this message until a few moments ago. This is really good news. I was strongly in favour of slow + pivot. But your post has made me think again.
Please correct me if I am wrong.
The ECC currently has finance for 24 months. (I thought it was 12 and had been working under that assumption)
The 2 years worth of funding, that is “cash in the bank” as in it has come from currently block distribution? (this is really important) or is it some new source?
If this two years has already been paid for, does this mean that even if/though the dev fund stops in 2020 the ECC has pledged to be all in ZEC til 2021? (I really hope this is the case)
If this is the case, new funding wouldn’t technically be needed until NU5.
So Governance doesn’t need to be settled for august 31st, it could be in NU 4.5
This would give considerable time for voting/polling/staking to be sorted out from within the community. (especially with the Placeholder people and others now shining a light on the governance thing, an area I lack in considerably so haven’t been able to bring much to the table)
Or do we still need to try to get governance proposals through for NU4 deadline?
The first indicator, Good Planning, requires excellent forward planning, which includes detailed planning of the process implementation stages, task timeliness, fall-back positions, and re-planning. Notice that initial planning is not enough. Projects often take wrong turns, or initial solutions prove unfounded. The project manager who does not prepare to re-plan, or has not considered and planned fall-back positions when initial plans fail, will often find that the project first stalls, and then fails. We must remember that project management is not a straight-line process, but an iterative process that requires agile rethinking as the known environment changes before your eyes.
For Zcash to achieve it’s promised goals the original plan must be reconsidered and steady funding must be continued
ECC has funding for roughly 24 months assuming dev funds through Oct 2020. The current cash and ZEC on hand is under 12 months at today’s price. We need 12 months visibility, including anticipated dev funds, to give us time to pivot if the community chooses not to support our work. We’re all in - knowing that we are at risk but also with clarity that the success of Zcash requires that we be all in and hopeful that the community believes in our work. We’re all in because we believe in our shared mission. We’re all in because it’s the right thing for the future of this world we share. Realistically, this requires a codified decision in NU4. I believe the deadline for submission is Aug 31.
