Undisclosed and actively relevant conflicts of interest on the Zcash Foundation Board of Directors

Folks, I know this is hard, and uncomfortable, and there will be a lot of hurt feelings and alarm and backlash, but I think it is necessary to bring this to the attention of the Zcash community, and necessary to do so now, before the debates about open-source licensing go any further.

Moderator’s note: Zcash Foundation Executive Director @Dodger and Board Member @Matthewdgreen has responded to the concerns mentioned in the Medium post. Moderator is linking their reply here to help new readers up to speed: first reply and second reply.

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Holding my breath, as we are going to see another long thread of discussions.

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Wow. Many in the community have mentioned parts of the article as big risks to the longterm strength in Zcash. I really hope anyone mentioned, aswell as anyone affiliated, does not look at this as an attack on their character rather an opportunity to make Zcash the shielded asset stronger. Working on multiple projects is exactly what many people do when they have a very defined and unique skill set. I could not have more respect for the @secparam and @tromer s’ of the world and believe they did not engage in these activities at the detriment of Zcash. Moving forward, we (the Zcash community) need a plan to make our breakthroughs lead back to ZEC. This is where Zooko’s feedback loop comes into place. If we want more breakthroughs and innovation this is critical. So once again, I am pleading everyone approach this with the lens of how we can make Zcash stronger. Thank you so much for the post Zooko (I know it took a lot of courage to make it) and regardless of what side people are on ~ it is evident these issues are being brought up in good faith for the longevity of Zcash the ASSET. I can’t wait to hear what some of the smartest people in the world have to say about how we can move forward in a unified way nor do I fault anyone for capitalizing on their unique skill set…

Cheers :heart: :shield:

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If true, this would explain a lot.

Thank you for looking after ZEC holders’ interests, Zooko.

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Beyond wanting actual confirmation from Ian or another party who can confirm, I’d like to note that Tezos paying them for advice on a Sapling integration, while worthy of disclosure to the public in my opinion, does not create a conflict of interest with how Orchard should be handled unless Tezos suggested/stated they’d also pay for Orchard IMO (not a lawyer though, so more commenting on my opinion on what’s notable as a conflict).

As for Sealance, there are other private transaction protocols out there. While they don’t appear to have anything public, so you appear to making claims about closed room discussions they may be having, I can’t comment on the usage of the term “shielded” nor can I comment on the setup being trustless, I know I recently saw a Chinese research paper on a Monero fork with government accessible transaction data though.

I’d also ask, as you made sure to disclose, if your relationship with Tezos does not mean you should recuse yourself from the licensing of Orchard, as Orchard is presumably tech they’d be interested in, your advisory position puts you in a prime position to sell a license to them (an ability you only have thanks to the BOSL license you advocate for). While that’d be a boon for the ECC. and therefore isn’t really a conflict of interest on that level, I’d argue it is a conflict of interest for Zcash as a whole when I assume the ECC pays you a salary?

As for trademark allowances, personally, I’d hope it’s guaranteed Zcash remains free software under OSI approved licenses, as the OSI OSD is acknowledged, which does mean rejecting usage of the trademark for any software where core code isn’t licensed accordingly. TM rejections on upgrades seems to be an explicitly established right of both the ECC and the ZFND which the ZFND may or may not execute.

While I hope for your questions to be answered, I also hope you answer Dodger’s extensive questions, and I also hope you answer my question on whether or not this is actually up to the community like you’ve so far claimed.

As a side note, the last three posts on your blog have been inflammatory and purely consisting of secondhand accounts and conjecture without any actual evidence. The best was a tweet (without direct evidence) which wasn’t clear on why the supposed payment was made, where the accused party clarified they did not make any payment for the purposes you wrote about, and a set of PMs (again without direct evidence) which claims they couldn’t even access the original messages. It’s quite exhausting to see what feels like a resurgence of Robespierre. Can everyone please agree, as a general premise, to not use unverifiable conjecture as a basis for discussion on these forums?

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FYI, Matt responded to Zooko’s claims via Twitter:

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Good. Having thus resolved these ludicrous personal attacks, we can go back to resolving the actual questions about the BOSL license that have been open for years now and are going unanswered by ECC even while their blogpost-induced clock is ticking.

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Nothing was resolved, Matthew’s posts just deviate attention from what really should be clarified:

Did Matthew disclose the conflict of interest to the Zcash Foundation Board?

If he did, what was the reason behind the Foundation deciding not to disclose this info to the community?

And if he did not, why didn’t he?

Same goes for Ian and Tezos.

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  • “isn’t a privacy coin”
  • Not using Orchard
  • Not even currently planning to use Sprout or Sapling

What conflict of interest do you believe exists with Matthew specifically?

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“A system based on ZK to help customers use DeFi”

Isn’t that one of the main goals for which it was decided to fund R&D for ZSA’s?

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Regardless of ECC’s opinion about BOSL ~ do you think it’s important to get community support to open up the license or is this just an ECC vs ZF thing? From a community perspective it seems like most do not want to change BOSL licensing. Is that okay? I mean, obviously you and other critical researchers have advocated against keeping it how it is but do you think Zcash should be held hostage if the community ultimately chooses not to open up the license?

So it seems like “Zcash’s tech” is not being used to make a competitor to money (although it would be a competitor to shielded assets) ~ is it wrong to ask these questions? I think, if we learned anything maybe we should make a much better disclosure procedure. Everyone criticizes Zcash to be a research coin (although we know it it’s much more) a better process is obviously needed!

Once again, totally respect everyone at the ZF but ultimately would the ZF hold back a trademark because they think the Zcash community is making a mistake with the BOSL license?

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It sounds like it regards KYC while hooking into ETH’s DeFi offering (it sounds explicitly like an ETH SC, which would explain using ETH supported curves and Groth16, which Tornado Cash has a verifier for and is reasonably efficient on ETH). That would have no overlap with ZSA’s. If ZSA’s evolve into ZSC’s, then it sounds like Sealance could be an offering for ZEC just as it would be for ETH while bringing its userbase over with it.

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Just answer yes or no to my question, if possible.

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I can’t say I remember every marketing angle proposed around ZSAs, yet I never believed ZSAs to do anything significant for DeFi due to the lack of scripting. I would say “No, ZSAs are not a ZK system meant to enable DeFI”. I would say some evolution may or may not be. I would say if DeFi ever comes to Zcash as one of those future potential evolutions, a ZK KYC platform would be an ally, and there’s still no conflict of interest.

As a side note, can someone please just flag these last 3 (including this one) or so messages as completely offtopic. It’s pure speculation, and a personal attack, with no contributive value.

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Ian seems to disagree with you

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Edited on 15th May to add:

After publishing his Medium post, and posting a link to it on Twitter, Zooko subsequently edited the post, removing almost all of it, including the unwarranted and unfounded accusations that it contained.

Fortunately, the Internet Archive captures a snapshot of the original post. It can be found here: Undisclosed and actively relevant conflicts of interest on the Zcash Foundation Board of Directors | by Zooko Wilcox | May, 2022 | Medium


Original post:

I’m just going to share some facts:

  1. We have a conflict of interest policy in place for the Zcash Foundation board.
  2. Matt disclosed his involvement with Sealance to ZF (it’s also listed on his LinkedIn, so not exactly secret). It clearly doesn’t cause any conflict with his role as a member of the ZF’s board. As an aside, I discussed the concept with Matt and Eran back when I was with ECC (I can’t recall exactly when), and I mentioned it to Zooko at the time. He didn’t express any concerns at the time.
  3. Regarding Ian’s involvement with Tezos - this is obviously an historical engagement (i.e. it ended long before I took over as ED of ZF) but Josh Cincinnati has confirmed to me that Ian disclosed his involvement with Tezos at the time. I can also say that Ian disclosed the Tezos involvement to ECC. I seem to recall that, at the time, Zooko was quite excited and positive about the prospect of Sapling being used in Tezos, as he believed it cemented ECC’s reputation as the leading team in this space. (ETA: He even tweeted about it! See third screenshot below.)
  4. A month ago, we communicated to ECC that we’re ready to execute the necessary paperwork to approve NU5.
  5. ECC sent through the paperwork 31 minutes before Zooko posted this topic (see a screenshot of the email below). Unfortunately, they’ve omitted to include Zebra in the list of implementations (second screenshot below) but I’m sure we can get that resolved quickly.

Happy Saturday evening, everybody! :smiley: :beers:


Link to the original tweet: https://twitter.com/zooko/status/1210701029743874048

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I’m not sure it is that clear.

It really does seem like a conflict of interests with the ZEC holders funding the Foundation’s activities.

What was the reasoning for not disclosing this information, that Matt founded a for profit company that would capitalise on a system based on ZK to help customers use DeFi", to ZEC holders?

Wasn’t that one of the main goals for which it was decided to go ahead and fund R&D for ZSA’s?, so people could DeFi on Zcash?

Seems like a conflict of interest to me.

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You keep using that as a quote, yet I don’t see where you’ve gotten it from (as it’s not in the above tweets, here, Zooko’s Medium post, nor the Sealance website). Would you mind providing a source or using an actual quote?

The two actual quotes most similar, in my opinion, would be:
“building financial compliance into digital currencies”
“We are trying to build an opt-in regulatory compliance and identity system that works on top of Ethereum and helps institutional customers use DeFi. It doesn’t provide transaction privacy like Zcash. It does use ZK, but that’s kind of a given since it’s what I do.”

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Dear Dodger, thank you so much for quick response — and again, on a weekend! I really appreciate you offering to sign off on the trademark rights for NU5 right away. We’ll figure out how to update the doc to include the right version/tag of zebra. Thanks again—getting the Zcash Foundation’s sign-off on NU5 is a huge relief for me, and really makes me feel better about everything. I hope you enjoy the rest of your Saturday evening. :slight_smile:

Update: okay the fixed document with zebrad included should be in your inbox.

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If there’s any overlapping on the addressable markets of ZSA’s and Matt’s company, then there is a conflict of interest.

Period.

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