I think the solution here is somewhat simpler actually @tromer @aristarchus; if something like this gets adopted in we’d just need the Foundation board to vote to modify its purpose to include “disburse funding according to the results of [future voting mechanism].” I’m not concerned about making that work and agree it shouldn’t stop anyone from supporting it @aristarchus.
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@tromer raised the following issues about this proposal on GitHub PR 276 that were not addressed in the merge:
Locking funds into the future is problematic from a security perspective. If the owner’s wallet is compromised, or a security-related movement of funds becomes desirable (e.g., consider the Sprout bug), then the owner would be unable to move their funds to protect them.
Additional considerations are discussed at Decentralized Participatory Voting through VESTING - #3 by tromer .
So it may make sense to weaken these requirements leaving them up to future community discussion.
and also, in response to the text “Because I share the foundation’s concern that the ECC could be “beholden to its shareholders”, I am mandating that the ECC should be working in the service of the Zcash community and shall serve no other masters. The original investors/founders who are not still working in the service of the Zcash community should not have control over the use of the new dev funds.”:
Under ECC’s current structure, I think the first requirement is impossible to meet as phrased: as a partnership, ECC is inherently “beholden to its shareholders”, and its board is determined by shareholders. Here’s an idea for alternative phrasing (jointly for these two requirements):
ECC must undertake a firm obligation to use the Dev Fund only in support of the Zcash cryptocurrency and its community, and to not distribute the Dev Fund proceeds to its partners (“shareholders”), other than
- In fair compensation for ongoing work
- For covering pass-through tax obligations to partners caused by ECC’s receipt of the Dev Fund
This obligation must be made irrevocable within ECC’s corporate governance (i.e., its Operating Agreement and Board of Directors), and backed by a contractual obligation to the Zcash Foundation.
Addressing this was beyond the scope of my editing role, so I left it as-is for now, but I agree there is a problem.
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Thanks, @daira, for keeping track!
@aristarchus, note that my Dev Fund to ECC + Zfnd + Major Grants proposal also addresses these two points, so the phrasing there (which fleshes out my suggestions above) may prove useful.
Added:
See the Future Community Governance section and the ECC slice (Electric Coin Company) sections there.
I’m in favor of a creating voting mechanisms. However, I have fundamental concerns about coin-holding-time-weighted voting. And also, security concerns about the version where coins are locked in advance. The public discussion of this, so far, hasn’t convinced me that the downsides are acceptable. So at present, I don’t support committing to this voting method as the sole means of deciding dev funding in the future. The aforementioned Future Community Governance section in my proposal is the strongest version I could come up with that leaves the requisite flexibility.
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I agree @tromer raised some good points that will need to be addressed in detail if this proposal is selected by the community. I still personally believe that coin holder voting is a good idea and can be made workable. In the case of security issue like the sprout bug, I would expect there would be some way to deterministically move funds into new safe voting addresses. That is to say we could have a method derive new safe addresses from the unsafe old ones.
As far as legal requirements for the ECC go, if this proposal is accepted then I agree that it would probably require some contractual agreements to ensure the ECC is only working on behalf of ZEC holders, as this proposal mandates.
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Another comment from @tromer on Github:
“What does “a stake in upside of the success of Zcash” mean? Simply paying some of the salaries in ZEC? Since ZEC can be easily converted to/from other currencies, and the receipt of ZEC is anyway taxable, I’m not sure what this requirement achieves other than headaches.”
I did not intend to mean that salaries should be paid in ZEC. I just wanted so make the ECC team financially incentivized to want the price of ZEC to go up. The mechanism to do this is not specified…I’m thinking of a couple different ways we could do this…
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