# Threads - Part II **URL:** \ **Category:** General\ **Created:** [September 25, 2026, 3:50am UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800 "2026-09-25T03:50:38Z")\ **Posts on this page:** 8\ **Page:** 1
**Author:** ![aaal](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aaal/32/36133_2.png) [@aaal](https://forum.zcashcommunity.com/u/aaal)\ **Post date:** [September 25, 2026, 3:50am UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/1 "2026-09-25T03:50:38Z")
Following on [Indpendence](https://forum.zcashcommunity.com/t/independence/56545/10) which stated: > Both Shielded Labs and ZODL, arguably the primary architects of Zcash’s future, are fueled by capital from billionaire venture capitalists who back an authoritarian regime, and hold massive direct stakes in ZEC. In [Threads - part I](https://web.archive.org/web/20260721051547/https://forum.zcashcommunity.com/t/threads-part-i/56728) I asked: > what other Zcash ecosystem organizations might be involved? > nearly all the leading organizations in Zcash are either explicitly funded by ultra-wealthy MAGA megadonors, directly support the efforts of those organizations, or are funded from unknown contributors. and and with introduction of Zakura, > the Zcash chain appears that it can now run entirely without input from independent organizations. This post looks more closely at funding patterns: what, when, why, how, and the first pass of who, and lays out the implications for the Zcash blockchain: price appreciation benefits these investors. This is to say when ZEC becomes more valuable, Zcash itself now appears to benefit authoritarian interests. * * * I regret how long this post took (trying to confirm my reasoning through research and private discussions), and my own limitations. I am not a financial reporter. However, with almost 0 news coming out that didn’t just repeat the ZODL press release, I’m going ahead. I hope to learn from any corrections, and create a path to more clarity. Mostly, this post will examine the ZODL funding, but I did uncover one extra fact about the funding of Shielded Labs (SL), who has maintained a quieter stance.\* It was a major, highly visible shift in the Zcash ecosystem when the entire ECC team quit, and re-formed as the for-profit ZODL, then [raising over $25 million](https://www.stocktitan.net/sec-filings/CYPH/10-k-cypherpunk-technologies-inc-files-annual-report-454adee13a61.html) in a [“seed funding” round](https://web.archive.org/web/20260806101230/https://zodl.com/zodl-raises-25m-in-seed-funding/). ECC left the oversight of the non-profit Bootstrap, which was painstakingly formed to be entrusted to oversee Zcash developed as a public-good, and had significant holdings from prior donations ([including significant ECC equity](https://web.archive.org/web/20201109165654/https://electriccoin.co/blog/ecc-owners-approve-donation-to-bootstrap-project/)). The nonprofit parent existed specifically to keep development aligned with the community and the protocol’s long-term health rather than investor returns. Though some of the specific investment instruments remain undisclosed, the primary protocol development organization ECC respawned as a private company, ZODL. Before moving on, we might ask why the ECC team made the change to for-profit-ZODL. Consider these possibilities: - It allowed for institutional investing. Due to their legal structure, investors can not give donations to a non-profit. The ECC team wanted more funding than Bootstrap would provide.† - It was suggested to me that it was necessary for some legal reason due to the NEAR interoperability being built into Zashi in 2025\*\* - and other issues were considered only after that decision. - Bootstrap [presented legal or public relations hurdles](https://web.archive.org/web/20260108112427/https://weareallzashi.org/), had an ethical system, was accountable to its stakeholders in some way, or had plans incompatible with the ECC, and therefore had to be abandoned. - The “seed funding” for the “startup” was itself a ‘power event,’ designed for publicity purposes, aiming for price appeciation. Regardless of the reason, the team quit Bootstrap, reformed as a for-profit, and quickly raised ample funds from parties including some of the most powerful Venture Capital firms (VCs) in crypto to do the same work, without the same oversight or constraints. [Specifically](https://web.archive.org/web/20260806101230/https://zodl.com/zodl-raises-25m-in-seed-funding/), the investors were institutional VCs [Paradigm, a16z crypto, and Chapter One], two corporate investors [cypherpunk technologies, Coinbase Ventures], two ‘family offices’ [Winklevoss Capital, and Maelstrom (Arthur Hayes)], named individual angels [Balaji Srinivasan (@balajis), David Friedberg, Haseeb Qureshi (of Dragonfly Capital)], and other unnamed “leading angels across crypto and technology.” I’ve highlighted the authoritarian support of the Winklevoss Twins (behind the cypherpunk corporation and Winklevoss Capital) [in my Independence post](https://forum.zcashcommunity.com/t/independence/56545/) (though since then, [cypherpunk also has launched the world’s largest Zcash mining fleet](https://en.cryptonomist.ch/2026/08/19/cypherpunk-zcash-mining-fleet/) at [18% hashpower](https://www.theblock.co/news/business/2026-08-18-cypherpunk-technologies-launches-zcash-mining-fleet-412071), supplied by Winklevoss Capital, where [one employee has been vocal in retiring the independent protocol block reward funding steam of the Zcash dev fund](https://web.archive.org/web/20260909132945/https://twitter.com/maxdesalle/status/2097678850725425224), with [some parallel ideas from Qureshi](https://cointelegraph.com/news/dragonflys-qureshi-end-zcash-dev-fund-2028)). Many of the other investors are also notable for their support of authoritarian government and commercial forces (for just one striking example, [a16z also funds](https://web.archive.org/web/20260920202134/https://a16z.com/announcement/investing-in-flock-safety/) the [mass surveillance startup Flock](https://fortune.com/2026/08/24/flock-8-billion-startup-backed-a16z-tiger-surveillance-camera/)), leading two rounds totaling $425M, (see [here](https://www.globenewswire.com/news-release/2021/07/13/2262009/0/en/FLOCK-SAFETY-RAISES-150M-IN-SERIES-D-FUNDING-LED-BY-ANDREESSEN-HOROWITZ-TO-REDUCE-CRIME-IN-AMERICA-BY-25-IN-THE-NEXT-THREE-YEARS.html) and [here](https://www.flocksafety.com/blog/flock-safety-secures-major-funding)) and participating in more. So as to not make this post interminable, I’ll go into more detail on the funders themselves in a follow up. How did ZODL make investment attractive, or, why did investors invest? It will almost certainly **not** be to later issue public stock, generate significant revenue via fees\*\*\* or services, or by minting a token other than ZEC. Acquisition by another, larger company for its talent also seems unlikely. There is no clear and viable return mechanism, that is, a path to profit, for a traditional equity play found in a seed round. So, what does an exit look like for these investors, if it is none of these? For at least some of the investors the answer seems clear: coin value appreciation, aka ZEC price goes up. The round funded the development and shepherding of a network whose value is measured in tokens that investors already held: _it increases the value of their existing ZEC positions_. In that case, any equity is merely a mechanism to formalize the relationship, and not a meaningful value transfer.§ Five of the named parties had a documented ZEC stake, close association with such, or Zcash commercial relationship at the time of the funding event: cypherpunk, Winklevoss (through the Gemini exchange, cypherpunk, or as the mining equipment counterparty), Coinbase Ventures ([Coinbase is custodian for the recently launched Grayscale ETF](https://crypto.news/grayscale-launches-first-zcash-etf-with-direct-zec-exposure/) - which has a 2.5% annual fee), and Maelstrom held at the time of the round, [but has since publicly dumped](https://www.tradingview.com/news/newsbtc:4136464ec094b:0-arthur-hayes-dumps-entire-zcash-bag-keeps-wld-bet-alive/). In the time I have been working on this post, [Paradigm also declared a stake](https://blockonomi.com/zcash-zec-rallies-23-following-fed-decision-and-community-governance-results) on [September 17](https://coinpaper.com/35863/zcash-price-explodes-toward-1400-as-paradigm-reveals-zec-investment), though the size of the position was not disclosed. That leaves Six of the named parties (a16z, Chapter One, Balaji, Friedberg, Qureshi, Nicholas) which have no public documentation of ZEC holdings or a Zcash-adjacent commercial stake: I found no public evidence. That means either they hold ZEC privately, or they had different investment motivations. Even if they may not have ZEC holdings, one possible deliverable is an R&D or development contract, which can give immediate contractual rights. For example they could specify protocol upgrades, wallet features, and so on. [a16z explicitly made a privacy thesis in its October 2025 State of Crypto document](https://a16zcrypto.com/posts/article/state-of-crypto-report-2025/), as an important market narrative. Investors could also obtain a seat on the company’s board, enjoy information covenants, review or veto rights, in addition to a development goals or claims on the company’s future cash flows, if any. Company governance rights could influence roadmaps, or permissive licensing integration. Some plausible examples would be; in-app rails to Gemini or Coinbase, clout for adjusting protocol block times or preserving tex addresses, a16z could seek integration or with other [projects in their portfolio](https://web.archive.org/web/20260901220633/https://a16zcrypto.com/portfolio/): for privacy, maybe nextgen mixnet Nym, XMTP, or stablecoin project Aleo.ⱽ Or, intriguingly, a16z crypto also invests in NEAR, which was being integrated into the Zodl wallet in 2025 when it was still Zashi. See also the `**` footnote. I feel this alignment might be fruitful to investigate more. A PR move also could fit for a firm the size of a16z (currently [claiming over $100B+ under management across multiple funds](https://web.archive.org/web/20260921022259/https://a16z.com/about/)), using ZEC as a fund-marketing asset. Beyond these, interestingly, investment could be ascribed to regulatory strategy. This is harder to dismiss than it might appear at first. The ZEC token is still in US financial regulatory ambiguity: it’s neither confirmed as a commodity nor confirmed as a security, though the [SEC closed its Zcash Foundation investigation in January 2026 without enforcement](https://finance.yahoo.com/news/sec-clears-zcash-foundation-zec-182522062.html). The timeline is notable too. The ZODL funding round was public March 9 2026, just about one week before March 17, 2026, when the US [SEC and CFTC jointly issued a 68-page release naming 16 assets as digital commodities](https://blockeden.xyz/forum/t/the-secs-16-digital-commodities-historic-clarity-or-a-vip-list-that-left-everyone-else-behind/3957). The VCs could have been positioning just ahead of a major liquidity event. But ZEC was not on the list. This means the token has no formal US federal classification. Roughly five months later, the Grayscale ETF launched on August 25, 2026. With the ETF, a meaningful portion of ZEC is now in a regulated vehicle. Zcash’s core development has moved from a structure where a non-profit public-good mandate governed, to one where VC return expectations govern, which is a shift that introduces classification risks that the earlier structure avoided. ZEC operates in a regulatory gap that the ETF’s launch assumes will hold (The ETF’s operational machinery only works if it’s treated as a commodity), but the VC-funded protocol maintenance entity removes the nonprofit public-good mandate that previously served as a built-in defense against claims that ZEC should be regulated as a security. The [Howey Test](https://en.wikipedia.org/wiki/SEC_v._W._J._Howey_Co.) states securities will have all of these criteria, as [currently applied to digital assets](https://www.sec.gov/files/dlt-framework.pdf): Investment of money, In a common enterprise, With a reasonable expectation of profits, Derived primarily from the efforts of others (and not the investor’s own efforts). It is the classic test for whether an asset is a security. If ZEC’s value depends primarily on the ongoing development and security work of a for-profit entity whose own investors expect financial returns from ZEC’s appreciation, that structure maps onto ‘investment in a common enterprise with profits derived from the efforts of others.’ The ETF’s regulatory status would likely have gained durability from the CLARITY Act, but the bill is now [not going to pass in 2026](https://www.politico.com/news/2026/09/15/crypto-bill-collapses-on-senate-floor-01077617). Coinbase has direct exposure to ZEC’s classification. a16z is exposed overall to the regulatory framework: the commodity-vs-security taxonomy that governs their entire crypto portfolio. The ZODL investment is a relatively small check for these entities to nudge an important variable in any future classification challenge. It could be an important secondary alignment: by backing the protocol developer, they ensure the protocol continues to look like a decentralized network (commodity) rather than a centralized product (security). This protects the ETF, exchange listings, and the broader classification framework some of the investors’ portfolios depend on.◊ Even if a challenge is unlikely to trigger a securities reclassification, this may change the risk profile for anyone relying on long-term protocol stability. Related to regulation, the newly renamed US-targetted lobbying organization (Pretty Good Policy for Zcash aka [PGPZ](https://pgpz.org/)) whose chairman is Paul Brigner (@paulbrigner) is also ZODL’s Chief Policy Officer, and a ZCG board member. ZODL investor a16z’s Head of Regulatory and former US Department of Justice Digital Currency Counsel, and US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) Michele Korver sits on the board. I feel all these relationship dynamics are notable. PGPZ is essentially a ZODL mouthpiece, [directly descended from](https://web.archive.org/web/20260823015645/https://pgpforcrypto.org/) PGP\* for Crypto, which [was launched in 2022 by ECC](https://github.com/ZcashCommunityGrants/zcashcommunitygrants/issues/65), now ZODL. See some of my comments about this stuff [here](https://forum.zcashcommunity.com/t/cypherpunk-policy-dinner-cpd-zcg-anchor-sponsorship/55592/11) and [here](https://forum.zcashcommunity.com/t/cypherpunk-policy-dinner-cpd-zcg-anchor-sponsorship/55592/14). Their $750,000 [inaugural grant](https://forum.zcashcommunity.com/t/grant-application-pretty-good-policy-for-zcash/57134/) was [passed unanimously by the once independent ZCG](https://forum.zcashcommunity.com/t/zcash-community-grants-meeting-minutes-8-31-2026/57394) after being open for only 12 days, without any public facing discussion of their evaluation, though it was stated Paul recused himself. How much ZEC do funders and funder-aligned interests hold? This is of course an impossible question to answer given the private nature of Zcash. The two we know of for sure are the cypherpunk corporation and Coinbase. As of May 2026, cypherpunk held a total of 314,185.7 ZEC (approaching 2% of the ZEC ever projected to be created.) Along with the approximately 445k ZEC managed by Coinbase for the ETF and taking into account the amount funded to ZODL, it might be very roughly estimated that the ZODL investors jointly hold about 10% or 11% of current and future ZEC tokens. In conclusion, “seed funding” implies an equity round. The ZODL funding event was not that. The press release names investors in ZODL but does not disclose that they are major ZEC holders. That was a material omission. The event may have been an ecosystem subsidy, or one prong of a sophisticated capture, structured through a development company, or even a regulatory strategy. Broadly speaking, there may be a conflict of interest, as ZODL now has a financial incentive to make decisions that benefit its investors’ ZEC holdings - now becoming very valuable - rather than purely the protocol’s long-term health. Certainly, the price appreciation of ZEC has already enriched multiple powerful forces, plausibly to a magnitude of billions of dollars, engaging in authoritarian goals through governmental and financial means. * * * \*SL is a Swiss non-profit, funded by donations. I previously highlighted the Winklevoss and Vitalik donations. Vitalik himself wrote about the danger of coin capture ([in this tweet](https://x.com/VitalikButerin/status/2032469755614179700), and [this one](https://x.com/VitalikButerin/status/2058583593102844111), while posting about the CROPS initiative for the Ethereum Foundation). Beyond these, I did find a reference to [funding from The Anoma Foundation “and anonymous donors”](https://web.archive.org/web/20240810052038/https://medium.com/@zooko/zcash-is-winning-48579b89770e), in a mid-2024 blog post from @zooko. They are associated with the Namada blockchain, and had an original seed round with participation from Coinbase Ventures, who also backed ZODL. Anoma was seeking [$1B valuation in 2024](https://www.coinspeaker.com/anoma-40m-funding-1b-crypto/). Heliax is the associated software development firm. They [were working to produce airdrop tooling for a Namada air drop (to ZEC addesses)](https://forum.zcashcommunity.com/t/on-namada-zcash-alliance-shielded-airdrop-to-zcash-holders/46189). The [last post was from over a year ago](https://forum.zcashcommunity.com/t/status-update-rfc-zec-nam-shielded-airdrop-protocol/49144), ending with [suggesting a “public bounty for whoever finishes a qualifying implementation first.”](https://forum.zcashcommunity.com/t/status-update-rfc-zec-nam-shielded-airdrop-protocol/49144/35) †For a perspective, [in an interview](https://www.bankless.com/podcast/zodl-is-to-zcash-what-coinbase-was-to-bitcoin) @joshs said they spoke at an event hosted by Balaji Srinivasan (@balajis ), himself a ZODL investor: > “…Balaji [talks to me] afterwards and he’s like… Zcash is one of the most important projects in the world… Like, are you well-funded enough to get to the level of growth that we need to get to in order to make this dent in the universe? …no, we’re not. He said, all right, let’s fix it. So that’s when we started working on fixing it and started this kind of process of talking to third-party investors. And I was quite frankly surprised. I think many have been kind of realizing with AI, with the things that are going on with Bitcoin, we have this kind of existential threat as it relates to cryptocurrency, how important privacy was as a thesis to these major investors.” The event seems to have been in early October 2025. \*\*Near Intents appears in the [ECC Q2 2025 roadmap](https://web.archive.org/web/20250415052429/https://electriccoin.co/blog/ecc-roadmap-q2-2025/) (alongside Maya DEX), where they were called DEXes, with features rolling out in beginning in August 2025. On this topic, after looking into it, I previously asked some questions about [NEAR and KYC/AML in February 2026](https://forum.zcashcommunity.com/t/near-intents/54588/5), while I was still actively developing around Zcash. These questions were never addressed by NEAR representatives, though [they did say NEAR](https://forum.zcashcommunity.com/t/near-intents/54588/11) > enabled hundreds of millions of dollars to flow seamlessly into Zcash which landed seven heart emojis, including from ZODL CEO @joshs and Shielded Labs Founder @aquietinvestor. On a related note, recently, [a user has had an issue where NEAR apparently froze a transaction and has held their sizable balance for almost two months](https://forum.zcashcommunity.com/t/my-experience-exiting-shielded-zec-from-zodl-to-near-intents-589k-usdt-still-held-50-days-despite-a-written-compliance-clearance/57497), currently without resolution. [It appears now NEAR is not really a DEX](https://forum.zcashcommunity.com/t/my-experience-exiting-shielded-zec-from-zodl-to-near-intents-589k-usdt-still-held-50-days-despite-a-written-compliance-clearance/57497/50). Because of the adoption and timing of this development priority, as well as the presence of this project in one of ZODL’s investor’s portfolios (a16z) I feel this angle might have significant importance to understanding the ECC exit. \*\*\*ZODL has protocol engineers, and develops free software. A flagship wallet adding fees could be quickly forked into a wallet that removed the fees - though the NEAR integration may turn out to be relevant to this idea. § I did find [one well-done but unattributed article](https://finance.biggo.com/news/68610674d3b9855b) articulating this idea. There is also a potentially supporting quote from [Josh’s interview](https://www.bankless.com/podcast/zodl-is-to-zcash-what-coinbase-was-to-bitcoin): > “…they had an allocation that they want to invest towards Zcash in the Zcash ecosystem. They were taking 75 to 90% of that, and they were buying or had planned to buy or will buy ZEC. And then the remainder 10 to 25 percent they funded they funded ZODL because they believe that there’s a symbiotic relationship between ZODL and and zcash…” ††[Coinbase serves as custodian for the Grayscale Zcash ETF](https://247wallst.com/investing/cryptocurrency/2026/09/08/zcash-crossed-1000-two-weeks-after-grayscales-etf-launched-is-privacy-the-new-institutional-trade/) (ZCSH), [holding ~444,600 ZEC as of September 4, 2026](https://finance.yahoo.com/markets/crypto/articles/zcash-etf-net-assets-reach-034201771.html), representing more than 2% of the ZEC ever projected to be created. This may serve to support a [just launched a ZEC-backed token](https://www.coingabbar.com/en/crypto-currency-news/zcash-news-cbzec-launch-base-defi-aerodrome) on their ETH Layer 2 Base chain. ⱽSuch a background might be behind the `AGPL-3.0-only` licensing of ZODL software: [`zodl-android-wallet-sdk` updated August 24 2026](https://github.com/zodl-inc/zodl-android-wallet-sdk/blame/main/LICENSE) - and [instantiated Aug 7 2026 in the slipstream sync engine](https://github.com/zodl-inc/zodl-android-wallet-sdk/blame/main/LICENSE). > " you may use, study, modify, and redistribute ZODL Slipstream, but if you incorporate it into an application, the complete source of that application must be made available under the AGPL to its users, including users who interact with it over a network. If those terms don’t fit your project, **commercial licenses are available** …" Emphasis theirs. That is, If you don’t want to open-source your entire app, you can buy a license from ZODL. The forked software [Zapp](https://github.com/JustZappIt/zapp-android) recently had to re-license its entire app to AGPL-3.0-only because it statically links a library, as [explained in their README](https://github.com/JustZappIt/zapp-android#license). This setup could create some revenue for ZODL, without centralizing control: a setup for desirable regulatory classification. ◊The original, November 2025 Grayscale S-3 [SEC filing](https://www.sec.gov/Archives/edgar/data/1720265/000119312525298561/zcsh-20251126.htm) describes ZEC as having “features associated with several types of assets, most notably commodities and currencies,” and also lists a risk factor: “a determination that ZEC is a ‘security’ may adversely affect the value of ZEC and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Trust.” Subsequent filings have conceded the undetermined status and have [restricted some ‘back of house’ mechanisms](https://www.stocktitan.net/sec-filings/ZCSH/s-3-a-grayscale-zcash-trust-zec-amended-shelf-registration-statement-37804b64d6c8.html) (in-kind redemptions). ---
**Author:** ![aquietinvestor](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aquietinvestor/32/34528_2.png) [@aquietinvestor](https://forum.zcashcommunity.com/u/aquietinvestor)\ **Post date:** [September 25, 2026, 2:20pm UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/2 "2026-09-25T14:20:09Z")
Similar to the [Winklevoss brothers](https://forum.zcashcommunity.com/t/independence/56545/3), the Anoma Foundation is among the Zcash holders and supporters that have donated to Shielded Labs, and we greatly appreciate their support. That said, none of our donors determine our roadmap or priorities, nor has their funding ever come with direction about what we should build. We independently decide what to work on based on what we believe is best for Zcash. Shielded Labs is an independent Swiss association. Our donors do not receive equity, ownership, governance rights, or an economic interest in Shielded Labs in exchange for their contributions. Donations do not buy control over Shielded Labs or our work. ---
**Author:** ![aaal](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aaal/32/36133_2.png) [@aaal](https://forum.zcashcommunity.com/u/aaal)\ **Post date:** [October 5, 2026, 4:06am UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/3 "2026-10-05T04:06:51Z")
Thank you @aquietinvestor for responding. Of course the reason these questions have come up is because of the donations Shielded Labs has accepted - but it’s very important to hear your position, as you represent Shielded Labs to the community. That’s contrasted with the near perfect silence of CEO @joshs and other ZODL representatives, who are much more clearly centrally involved in this pattern. Now, I’d also like to note a new data point: > **[Winklevoss-owned Gemini switches Zcash software ahead of faster 25-second blocks](https://www.coindesk.com/tech/2026/09/30/winklevoss-owned-gemini-switches-zcash-software-ahead-of-faster-25-second-blocks)** > > The new Zakura nodes caught up with the network in just over six hours in Gemini’s deployments. The crypto exchange’s previous software took close to a day. This evidence appears to support my [prior hypothesis from about 2 1/2 months ago](https://forum.zcashcommunity.com/t/threads-part-i/56728) that Valar (@ValarDragon) and Tachyon’s (@ebfull and others) undisclosed donors are the same authoritarian supporters who have donated to Shielded Labs and invested in ZODL. This comes along with the implication that the Zebra full node is no longer needed - and that the Zcash blockchain does not need to conform with organizations that have not taken donation or investment from the same people. > _the Zcash chain appears that it can now run entirely without input from independent organizations_. That is to say, I believe the Zcash Foundation is in a position, now, to be cut out of a decisive role in guiding the future of Zcash. For myself, right now I’m more closely examining the new [PGPZ organization](https://forum.zcashcommunity.com/t/grant-application-pretty-good-policy-for-zcash/57134/8), who are as mentioned above, stemming from ZODL and now major ($3/4 million) funding recipients of the ZCG. As lobbyists they will represent Zcash’s interest to US policymakers (and other VIPs I presume). The shells are stacking… I’ll just tease for now. 🙂 But I’ll be publishing soon enough. ---
**Author:** ![divijpandya](https://avatars.discourse-cdn.com/v4/letter/d/da6949/32.png) [@divijpandya](https://forum.zcashcommunity.com/u/divijpandya)\ **Post date:** [October 5, 2026, 11:40am UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/4 "2026-10-05T11:40:00Z")
Hi 👋🏽 @aaal, we’re an open book, so please lmk if you have any questions. Note that we’re actually a separate org and not anyone’s mouthpiece; and the SEC, under this admin, has distinguished tokens that can be the object of an investment contract from the contract itself. Neither the SEC or CFTC is expected to comment on ZEC’s status, but under the framework being built, it’d be a digital commodity, a position we support (see our SEC comment letter outline in the PGPZ application thread for more info). ---
**Author:** ![aaal](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aaal/32/36133_2.png) [@aaal](https://forum.zcashcommunity.com/u/aaal)\ **Post date:** [October 7, 2026, 12:49pm UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/5 "2026-10-07T12:49:19Z")
Hello @divijpandya - I’ve seen your messages, thanks for replying.\* The idea of lobbying the US government itself being righteous or good is not something I concede, but I understand that the ecosystem overall has resoundingly fallen in behind this course of action - focusing on the United States’ regulatory embrace as a necessary condition for continued operation of important development organizations (read: ZODL), and their investors’ benefit (listed above), and then, @joshs 's always dawning, promised future mass adoption of unstoppable private money. So, here, I’ll take PGPZ as granted. Let’s proceed with some details. Adding to what’s above, just in the last few days, on [September 30, 2026, the United States Securities and Exchange Commission (SEC) has changed its own quorum rules for the first time in 30 years, to allow a single commissioner to act as the full Commission](https://www.sec.gov/files/rules/final/2026/34-106537.pdf) : a much more centralized path to policy. They also recently dropped to only two sitting members. This was done [without the opportunity for public US citizen comment](https://www.corpgov.net/2026/09/sec-quorum-rule-a-commission-of-one-adopted-without-public-comment/). Coming on the heels of the failure of the CLARITY act to pass, and [the situation at the CFTC I’ve noted previously](https://forum.zcashcommunity.com/t/independence/56545/10), this appears to clear the way for a unilateral process, [without the involvement of elected officials](https://finance.yahoo.com/markets/crypto/articles/sec-cftc-write-crypto-rules-164042293.html) or input from the US public. The [SEC has suggested](https://cryptobriefing.com/sec-plans-more-crypto-regulatory-proposals/) they won’t be idle. The SEC and CFTC were both set up by the [US Congress to have groups of people with different opinions, and from different political parties, be part of their decision making process](https://www.congress.gov/crs-product/R43391). Now, they are not functioning in that way. Together, the two major US political parties effectively hold a total monopoly on the administration of political power and flow of taxed money. They form a united block in support of the [country’s military industrial complex](https://www.propublica.org/article/military-defense-spending-budget-series) to enable its [warfare habit](https://theintercept.com/collections/the-911-wars/), {of course with the [most recent in Iran](https://www.theguardian.com/world/2026/jun/15/tallying-the-global-cost-of-the-us-israel-war-against-iran) being [still ongoing](https://web.archive.org/web/20260930091615/https://www.whro.org/virginia-center-for-investigative-journalism/2026-09-29/the-mounting-costs-of-the-iran-war)}, the [largest prison population in the world and the highest per-capita rate of any major democracy](https://web.archive.org/web/20260830162604/https://eji.org/news/u-s-remains-world-leader-in-number-of-people-incarcerated/), with a [large racial disparity and huge numbers of non-violent drug offenders](https://en.wikipedia.org/wiki/Incarceration_in_the_United_States), increasingly [militarized domestic police](https://www.aclu.org/publications/war-comes-home-excessive-militarization-american-police) forces, [warrantless domestic mass surveillance programs for the US citizens overseen by secret courts](https://web.archive.org/web/20260922203947/https://www.brennancenter.org/our-work/research-reports/section-702-foreign-intelligence-surveillance-act-fisa-2026-resource-page), unregulated [mass surveillance for the people of the world](https://www.eff.org/nsa-spying), and more. However, [recently, the two parties have diverged in their consensus on the new economic force of cryptocurrencies](https://prospect.org/2026/08/10/crypto-democrats-ghosting-industry-clarity-act/). Why? A few examples: the revelations that POTUS [Trump himself has personally benefited from crypto to the tune of nearly $1.5 billion dollars in 2025 alone](https://prospect.org/2026/07/24/crypto-clarity-act-genius-trump-republicans-senate-fairshake/) {[see also here](https://www.politico.com/news/2026/06/30/trump-crypto-windfall-disclosures-00983207)}, and also they are [now able to install regulators to essentially bypass the need for Congress](https://thehill.com/opinion/congress-blog/6039117-trump-executive-order-history/) to become involved. So, some questions: Did you, PGPZ, or any affiliate, lobby for, draft, or circulate language for the [SEC amendment](https://www.sec.gov/files/rules/final/2026/34-106537.pdf) (17 CFR 200.41) before it was adopted? Does PGPZ have any comment on the SEC rule change? The slimming down of both the SEC and CFTC commission personnel? What about the use of executive orders? Is the current situation advantageous or disadvantageous? If a single commissioner can now act as the Commission, do you think policy favorable to Zcash and crypto in general is now conditional on whether a specific political party holds the presidency? What type of actions, if any, from the SEC and CFTC will be advocated for, by your organization? What do you hope to achieve, and how? Are you lobbying _for_ the SEC or CFTC to act before Congress, or _against_ Congress acting? How does Zcash fit into the larger picture here? (The bigger picture being exchanges, investment funds, wall street… maybe even political importance?) In your view, how does the current regulatory environment register with the idea of representative democracy? * * * \*There’s an asymmetry I have to note, {again, after doing this dance with @paulbrigner} between your paid speech advocacy for PGPZ on behalf of the interests of the extraordinarily wealthy, and my own unpaid free speech - but as you’re about 4 steps downstream from the authoritarian supporters I’m concerned about (with, likely, many orders of magnitude pay cuts each step down the pyramid!)… maybe you’re underpaid enough to be one quarter as broke as I am! 🙂 Maybe we can find some common ground or help find some clarity. ---
**Author:** ![divijpandya](https://avatars.discourse-cdn.com/v4/letter/d/da6949/32.png) [@divijpandya](https://forum.zcashcommunity.com/u/divijpandya)\ **Post date:** [October 8, 2026, 9:33pm UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/6 "2026-10-08T21:33:25Z")
Disclaimer: any views expressed are mine only and should not be attributed to PGPZ or its Board. @aaal Always happy to discuss and work towards finding common ground. Note that PGPZ advocates for the ecosystem as a whole rather than any individual organization or investor, so any paid speech/advocacy is purely for the benefit of advancing Zcash. Not sure what your beef with ZODL is, but the focus on the United States is strategic not just for organizations based in the U.S., but those who want to build/avail themselves of opportunities in the United States. The United States’ policy positions that impact digital assets are important because other jurisdictions still look at what’s happening here and mirror legislative and regulatory concepts. The United States also plays an important role in the policies and standards that are published by organizations such as the FATF, BIS, OECD, IFRS, and IOSCO, which all impact global public policy development. That said, thanks to Michae2xl, I’m speaking with an attorney based in Brazil tomorrow to discuss how we can coordinate on a LATAM strategy. I’d love to get in touch with similar advocates in the UK, EU, MENA, and Asia so that we can establish global public policy principles around which we can frame our efforts. As I’ve mentioned in previous responses, PGPZ is a dedicated resource for the ecosystem, and the U.S. was a great first place to start advocacy efforts given the developing regulatory landscape and existing relationships across Congress and the regulatory agencies, such as the SEC and CFTC. We haven’t lobbied on the SEC rule, but with only 2 sitting Commissioners (Chair Atkins and Commissioner Uyeda), as you correctly noted, the agency needs the flexibility required to vote on Commission activity, such as initiating rulemakings and bringing enforcement actions. But I’m not here to defend the SEC or any other agency on its internal rules or procedures. Note that this rule change likely wouldn’t impact whether the process is considered unilateral since leadership at the SEC and CFTC is Republican, and there are no plans to appoint new Democratic commissioners. Filling these seats will likely require dealmaking when the White House and Congress are negotiating legislation. Candidly, it’s not ideal, particularly as it risks rules being scrutinized by Congress if the House and/or Senate flip to Democratic control, but there _is_ a process for the seats to be filled. I won’t comment on the broader political issues–it’s inappropriate for PGPZ to take a position on these items, given that our mission is squarely focused on advocating for the ecosystem, financial privacy, and developer protections. It’s true that the Senate Dems unanimously voted against the CLARITY Act procedural vote, but there’s more to it than the $1.5 billion. When you say regulators–are you talking about political appointments or staff hiring? Political appointments have a process. Personnel decisions are at the discretion of agency leadership. Now, for the questions: 1. Nobody involved with PGPZ has lobbied on the SEC’s rule change. 2. No comment on the rule change, however, as it does not impact our mission of advocating for the ecosystem. If that changes and it adversely affects ecosystem stakeholders, we’d be vocal about it. No comment on the workforce reduction; note that there was a mandate from the White House to reduce the size of the federal workforce. And Sen. Elizabeth Warren (D-MA), Ranking Member of the Senate Banking Committee, has asked the Government Accountability Office to investigate this. Note also that Executive Orders are directional and serve as signals for the federal government rather than mandates. The current situation is neither advantageous nor disadvantageous. Even if the SEC and CFTC each had 5 sitting commissioners, the majority would be Republican under this Administration, and they’d still be able to advance their agenda/policy priorities. 3. This has been the case under Trump 1.0, Biden, and Trump 2.0. Under Trump 1.0 and Biden crypto had a target on its back. Under Trump 2.0, the reception has been much friendlier to industry. The pendulum will keep swinging, which is why it’s so important for us to work with Republicans and Democrats on durable policy. 4. The SEC and CFTC are the federal market regulators, so our engagement would focus on market structure and digital asset regulatory treatment. We’re advocating for digital assets to be treated as digital commodities, enabling use of privacy-preserving technologies, and protecting developers. We have a different strategy for the IRS/Treasury for tax and the bank regulators/Treasury/FinCEN for illicit finance/AML/KYC/Bank Secrecy Act. The goal is the same for all–helping them understand what Zcash is, how it can be used, and why financial privacy and developer protections are so important. Regarding the how: education, building relationships, and commenting on legislative and regulatory proposals. We’re not lobbying for either the agencies acting before Congress or against Congress acting–we’re responding to the opportunities available to us. That said, we’d try to get ahead of any legislative or regulatory proposals that adversely impact the ecosystem. 5. Candidly, I’m not sure what this question is asking. We’ll partner on advocacy efforts with exchanges, investment funds, etc., to the extent it supports our foundational policy principles that promote Zcash. 6. No comment on this one. The question’s a bit too broad re: PGPZ and our advocacy. Call it a cop-out if you want, but this is a public forum that anyone can view/GenAI can cite in its responses and the _only_ thing that should be attributed to PGPZ is our mission to zealously advocate for the ecosystem. As a concluding note, I’d like to express how grateful I am to this community and the ecosystem for entrusting PGPZ to advocate for the ecosystem. We take this mission very seriously, which is why everything ties back to “what does it mean for Zcash and how can we advance policy that benefits the ecosystem.” I don’t love that most of my answers above are essentially “no comment” or that PGPZ doesn’t have a position on the matter, but that’s because those questions are outside of the scope of our mission in advocating for the ecosystem and any personal views I may hold take a backseat to promoting the ecosystem’s interests. ---
**Author:** ![aaal](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aaal/32/36133_2.png) [@aaal](https://forum.zcashcommunity.com/u/aaal)\ **Post date:** [October 10, 2026, 1:06pm UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/7 "2026-10-10T13:06:33Z")
A couple small points to try to keep your professional speech fair and accurate (nice job for the most part btw!) > [@divijpandya](#): > > leadership at the SEC and CFTC is Republican, and there are no plans to appoint new Democratic commissioners While true, it would be more accurate to say: > There are _no_ Democratic commissioners, and there are no plans to add any. When I say regulators I was talking about the appointments to SEC and CFTC specifically that will now be making rules ‘ahead’ or ‘instead’ of there being laws from the US Congress. Why did the Democrats stop supporting of the crypto industry if it wasn’t because of the $1.5 billion declared by Trump, and the prediction market stuff? Both parties were overall behind GENIUS, and CLARITY passed the house, easily. Something changed. Explain it to a layman from outside the Washington DC beltway. ---
**Author:** ![aaal](https://sea2.discourse-cdn.com/zcash/user_avatar/forum.zcashcommunity.com/aaal/32/36133_2.png) [@aaal](https://forum.zcashcommunity.com/u/aaal)\ **Post date:** [October 10, 2026, 1:12pm UTC](https://forum.zcashcommunity.com/t/threads-part-ii/57800/8 "2026-10-10T13:12:26Z")
In a few words, my criticism of ZODL is that they took money as investment from VCs that have aligned themselves with authoritarian interests in the public (US political funding), private (financial), and technological spheres. The impact of these interests is _extremely_ wide ranging and harmful. Though Shielded Labs was the first to publicly accept _donations_, ZODL definitively tied these forces into the fabric of Zcash. They have still not publicly commented on the association and re-packaging of the project under these terms, more or less decided _exclusively_ by them. ZODL’s only indirect comment so far was essentially “you should have seen how bad it was under Biden,” as if that is sufficient justification. These interests are now much enriched by ZODL’s actions, using Zcash as the vehicle. I think it is ‘a terribly bad look’ for ZODL, and for Zcash as a whole, as their embrace of these forces has been unopposed and even unremarked upon (except by me, it seems). It’s also a strategic error which is only beginning to show itself more clearly. There’s also the whole capture question: who is really guiding this chain now? Zcash is now associated with a political, ideological group that not only condemns other groups, but works to reduce their very freedom, safety, _and_ privacy. To see Zcash riding such a dystopian wave of corruption (and the concurrent systemic violence and loss of liberties) is upsetting - and extremely disappointing. If you want more details, see some of my findings that were not in ZODL’s press releases: > [@Independence](https://forum.zcashcommunity.com/t/independence/56545/): > > Some fun historical facts: [Crypto firms have supplied over $190 Million](https://www.axios.com/2026/01/28/crypto-coinbase-fairshake-pac) (more than one third of all corporate money) so far in the United States of America’s 2026 ‘midterm’ elections. [Leading in funding is Fairshake, a super PAC which alone has over $80 Million](https://www.reuters.com/world/crypto-firms-have-spent-189-million-so-far-2026-us-election-report-says-2026-06-30/).\* Donors include [Coinbase, Andreesson and Horowitz, and the Winklevoss twins](https://littlesis.org/org/456454-Fairshake). [Fairshake seeks to institutionalize the crypto industry](https://www.politico.com/news/2025/07/15/crypto-super-pacs-war-chest-key-house-votes-00452356) as a permanent political force in the United States federal government, overtly using political spend… > [@Threads - part I](https://forum.zcashcommunity.com/t/threads-part-i/56728): > > I had other questions come up when I was researching for my [Independence post](https://forum.zcashcommunity.com/t/independence/56545)\*, which concluded: One question was: what other Zcash ecosystem organizations might be involved? Because the answers are less certain, it’s important to acknowledge up front that they should be considered with a different weight: some things here are curious, or what I think are worthy of examination, not definitive evidence. While the above quoted post established and documented the direct pipeline of capital from… > [@Hazards - Part I](https://forum.zcashcommunity.com/t/hazards-part-i/56815): > > A quick recap of a few weeks of posting. All this is backed by facts no one has disputed. Identifying a troubling pattern of funding in [Independence](https://forum.zcashcommunity.com/t/independence/56545): Both Shielded Labs and ZODL, arguably the primary architects of Zcash’s future, are fueled by capital from billionaire venture capitalists who back an authoritarian regime, and hold massive direct stakes in ZEC. Finding more in [Threads - Part I](https://forum.zcashcommunity.com/t/threads-part-i/56728): nearly all the leading organizations in Zcash are either explicitly funded by ultra-wealthy MAGA…