Zcash Proof of Stake Megathread 🧵

It would take some time. @nathan-at-least will have a blog post out (very soon) that describes a potential approach that includes a hybrid model as a possible intermediate step.


Hey all!

I seem to be groping for a concept that could suit all parties and completely cover the risks that I wrote about earlier. Let me remind you that I am very worried about the behavior of the PoS model in halving, namely the threat of dumping coins due to a decrease in staking profitability in anticipation of a reduction in reward.

So maybe the community is happy with a hybrid model consensus. I propose to consider options when the share of PoS reward will double at the time of halving.
For example, these can be the following distribution models:
2nd halving: 20% PoS - 80% PoW
3rd halving: 40% PoS - 60% PoW
4th halving: 80% Pos - 20% PoW
5th halving: 100% PoS.

Or this option:
2nd halving: 25% PoS - 75% PoW
3rd halving: 50% PoS - 50% PoW
4th halving: 100% PoS

Such a system mitigates the possible negative economics and psychological consequences of the transition. Also, the concept fully gives a long-term understanding for miners and holders in which vector everything moves without abrupt changes in the rules - very smoothly and very balanced with respect to each side of the community. Also, the concept clearly defines long-term environmental priorities.

In addition, if my theory of cost still works, then such a concept actually has an accelerated coefficient of increase in the cost of one coin at the time of halving, instead of a 2-fold, 2.5-fold increase for the first example and 2,6-3-fold increase for the second. I don’t insist on a specific distribution, but I believe that distributions should provide for a two-fold increase in the share of PoS at the time of halving in order to compensate for staking.

My calculations are very simple. At the time of the second halving, the number of coins in circulation will be 15,750,000. Let’s say 10% of all balances will launch their own stacking nodes (1,570,000 coins). Then the reward in the amount of 25% of the issue will be 1800 coins x 25% = 450 coins per day, i.e. 164,250 coins per year. Which gives more than 10.46% per annum to these nodes. Even if we assume that the balances of the nodes will be significantly higher than 10% (which in practice does not occur), then the reward will tend to 1.04% per annum. I think this range is sufficient to motivate node creation, but this is model not be super profitable, in order to depreciate the value of Zcash.

At the same time, each subsequent halving does not reduce the percentage of remuneration, and the 12-16 year time reserve allows us to believe that the percentage of remuneration from commissions will grow along with the adoption of Zcash as a popular means of payment.

Honestly, I am ready to vote for this model today.


I like the idea of transition period and giving everyone involved with a chance to adjust their economics, instead of abrupt changes. The option above also aligns nicely with @nathan-at-least timeline prediction for research and implementation of PoS transition after NU5 deployment and ZSA development. Also, if indeed PoS (full or hybrid) proves to be less secure than PoW we will have the chance to evaluate our next move.


I posted this almost 2 months ago. Glad to see ECC is considering a hybrid model for PoS transition…

I think it would be valuable for the community to hear @cburniske thoughts on the hybrid model considering his familiarity with Decred & his role in the Zcash ecosystem…


A transition that takes 16 years might actually never happen. Several contributors and developers who will begin the work might not be with Zcash if it’s going to take that long to migrate from PoW to PoS.
The hybrid model makes sense for the 6-12 months transitionary period where large ASIC miners would anyway start leaving, opening up room for many individual/hobbyist ASIC/GPU miners to fill the gap created by them, all whilst running staking nodes which will help start the transition process.


This is along my thinking as well. I also think the 8 year further condensed option is still a long period of time for a full transition. Could half of that period work?

@artkor Have you thought about possible ASIC development/advancements in chip design/manufacturing/Moore’s law and what that means for the ASICs you’re currently invested in on an 8-16 year timeline? Granted there has not been much development on the ASIC front for our mining algorithm to date, but I think this is because the ASIC manufacturers have been averse towards developing for a project that might go PoS and is experiencing a lack of demand due to lackluster marketcap. If they know that a full transition is 8-16 years out and our marketcap has a turnaround moment then I see an increase in demand for ASICs and I would guess they know there is time for them to develop and sell to market.

Yes, Moore’s Law works great for mining-sphere. Moreover, I believe that the mining-industry had the most significant impact on the return of processor evolution from an extensive development path (an increase in the number of cores and threads) to an intensive one (an increase in power due to a decrease in the technological process). The hitch we are seeing this year with new ASICs is due to the fact that Apple is moving all of its devices to its own processors. The only truly powerful line of 5-nm chips to order is owned by the Taiwanese company TSMC (Samsung is now working mainly for its own needs). In fact, apple has received a temporary monopoly on 5nm technology. But this is only a bottleneck in the current moment. In 2022, TSMC launches several more 5nm pipelines. And they also plan to move to even more technologically advanced 2nm in the next few years. All this assumes an increase in the efficiency of processors and reduces power consumption. TSMC grows chips for the entire Silicon Valley and beyond: HiSilicon, MediaTek, Huawei, Realtek, AMD, NVIDIA, Qualcomm, ARM Holdings, Altera, Xilinx[11], Apple[12], Broadcom, Conexant, Marvell, Intel To understand this monopoly, I will say that the only major firm that has this technology in the US is Intel, but they have only 11nm technology, precisely because they focused on multipliers.

Since Zcash is not the only coin on the algorithm, I am absolutely sure that new ASICs will be created for the eqiuhash algorithm and beyond. Bitmain made their ASICs for Ethereum right on the eve of the transition to PoS and they are still not available for sale, although most of the hashrate of ETH is now made up by ASICs, and I am convinced of this, since it grew very quickly this year. During the Chinese ban, the hash rate of the Ethereum sank as much as the hash rate of bitcoin - this suggests that this is a huge Chinese capacity on the new ASICs. But these devices aren’t exactly made at 5nm. This is an old process technology, and Bitmain focused as much as possible on Ethereum this year, and at the same time they don’t sell this devices, because now they are bringing in hundreds of millions of dollars every day. This is a huge commercial industry, they know how to influence prices by the way ;), but that’s another story.

After ETH switches to PoS, all ASICs capacity will be redistributed to ETC.


My feeling is that the hybrid PoW/PoS will not be used for more than one halving cycle. Especially as ETH will have gone full transition by then and we would probably be more convinced if full PoS is indeed the way to secure Zcash for its next billion users.


Some information to consider before judging Proof of Work based on Carbon Footprint science established via the Paris Accord.

It’s hard to measure sea levels, because land often moves up and down too (which is known as “isostatic“). But Australia is stable tectonically, so the Australian sea-level record is more useful than most. It preserves the holocene era and the rises and falls, and correspond more with glacio-eustatic (ice equivalent) sea-level changes, rather than changes in land masses.

This information is very counter intuitive to the mainstream narrative that the earth has been warming and melting the icecaps, when Australia’s ocean levels, and tectonic stability would infer otherwise.




Now I understand that I was mainly guided from the point of view of price formation, without considering the technical aspect as such (and I will write about this below). But even the PoW pricing model, which I thoroughly understand, has some tendencies that need to be honestly considered.

  1. An acute shortage of chips leads to the fact that the batches of new devices are so small that they do not provide the necessary requirements for the sustainable growth of the hash rate of the coin.
  2. In addition to the lack of the devices themselves, other popular coins have appeared on the Equihash algorithm, which take a significant share of the hash rate from Zcash. I indicated this on the forum.
  3. The mining persecution in China has a significant impact on this industry. The day we became aware of the mining ban in China, PoW coins, including Zcash, lost up to 35% of the hash rate in one day. The hash rate has not recovered until now. On September 24, rumors began that China was completely banning any investment in this industry.
  4. Technological progress in the field of chips makes new chips so energy efficient that there is a clear tendency to reduce the share of energy consumption in the cost of mining. This gradually leads to the fact that ASIC devices began to concentrate in the same hands, namely, from companies very close to manufacturers, for which preferential purchasing conditions are available. In fact, this market has become heavily monopolized due to different terms of supply for individuals and companies.
  5. Industrial miners are more likely to purchase ASICs for Bitcoin than for Zcash, which poses a threat of shutting down work on the development of new devices for the Equihash algorithm, which uses Zcash.

All these trends and factors indicate that in the near future we no longer have any guarantees of a sustainable increase in hash rate. And in these realities, with a significant increase in the energy efficiency of chips, the conditional cost of one coin is likely to decrease even more. The cost factor in mining seems to be losing its previously huge role."

More: Что известно о переходе Zcash на PoS и опрос держателей ZEC


This is a fascinating megathread with many interesting analyses and deep experience. For the knowledgeable miners here, do you ever foresee the case where hardware becomes more and more expensive but also more and more efficient, requiring less energy? Is there a limit where you are, in effect, paying almost exclusively for hardware and less for operating costs? If so, this is the limit where buying hardware may perhaps be a pure proxy for buying coins with the exception that the hardware could generate more coins over time and help pay for itself and earn profit. If so, this is the limit where PoW becomes the same as PoS in economic terms. I wonder if this will ever happen?

Also, in terms of anonymous ways to actually buy Zcash, and mining being one such way of disassociating your on-ramp to Zcash from your identity, do you think something like thorchain or another way to go between chains in a robust manner would alleviate this problem?


All that you wrote is trends. In the end, it will happen that way.


More evidence with a disposition against the climate alarmism. The Ex-President of Greenpeace exposes the secrets of the politically motiviated climate claims made in policy set forth by the Paris Accord.

“The Scientists are hiding behind the politicians, because that is who funds them” - Patrick Moore Co-Founder & Ex-President of Greenpeace

“They are not scientists claiming there is a climate emergency, they are political activists… They are really really stupid and bad” - Patrick Moore Co-Founder & Ex-President of Greenpeace when asked about Extinction Rebellion

How would something like this impact our plans to move towards POS?

Ignoring the climate argument, good PoS design is multiple times more accessible to the masses than PoW with centralized production (easily seized by nation states) of specialized hardware (with clear advantage for the rich few).


Do you have any details how pos would work in zec ?
like what i need to do for staking ?
(minimal number of coins for minting\nodes or master nodes support\ etc)

or any ETA for this ?

no minimum stake. you will use wallet on tor browser or zecwallet fullnode. everyone in this world who using tor browser can stake zcash. 21 million of zcash stake in this world. imagine the price should be.

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Welcome to the forums @isxaker , the details as far as timeline are in the blog. As far as the specifics for staking and validators, it’s still being worked out.