Zcash Governance and Funding Next Steps

Update: To ensure the upcoming community call is productive, @decentralistdan and I have decided to postpone it by one week to refine the agenda and scope of the discussion. The primary focus of this call will be the future of the Dev Fund and the development of new governance processes for allocating funding. Earlier this year, community discussions and polls resulted in ZIP 1015, which allocates 12% of funding to a protocol lockbox and 8% to ZCG for one year while the community develops a new non-direct funding model (NDFM).

The key takeaways from those polls and discussions were:

  • The community does not want specific organizations to be direct recipients of the Dev Fund.
  • Direct funding to organizations creates misaligned incentives and makes it difficult to hold entities accountable.
  • The community wants to transition to a grants-based, non-direct funding model (NDFM).
  • Any NDFM should require funding recipients to submit concrete proposals, compete for funding, provide transparent progress updates, and deliver on their promises in order to continue receiving funding.
  • The community wants to further decentralize governance.
  • Panels like ZCAP, ZAC, and others can help inform organizations about community sentiment, but they are not forms of governance themselves.
  • Polls indicate strong consensus against the Zcash Foundation unilaterally controlling governance and the network upgrade process through the trademark agreement.
  • The community must decide on and develop a disbursement mechanism and governance process for allocating funds.

These principles will guide our discussions on future governance models and are not up for debate or rehashing during the call.

Currently, two proposals have been introduced for consideration:

  1. The Zcash Funding Bloc: Governance decisions, including funding allocations, would be determined by votes among ecosystem contributors, coinholders, and other stakeholders.

  2. The Bicameral System: A dual-chamber governance model inspired by Optimism, splitting decision-making between coinholders and other stakeholders.

Since there has been limited discussion about these proposals so far, the first community call will focus on the benefits and drawbacks of the Zcash Funding Bloc. The call will be strictly moderated with a clear agenda (shared with participants in advance) outlining specific topics and questions to keep the discussion focused and productive.

Please let me know if you have any feedback on the above. Otherwise, I will provide the updated date and time of the call next week.

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