Zcash community rallies to find consensus on a new 1-year dev fund

The results of community polling are in, and there will be a new Zcash dev fund in November. But this new model will be radically different from what Zcash has seen before, and it positions Zcash to be more decentralized, more inclusive, and more resilient than ever.

In 2020, the Zcash community created its first dev fund with ZIP 1014. It was a big step towards decentralization, as it established a novel mechanism that gave 80 percent of the block reward to miners and carved out a portion to the first-of-its kind Zcash Major Grants (now ZCG) in addition to funding for ECC and ZF. 

This new dev fund (Hybrid Deferred Dev Fund transitioning to a non-direct funding model) will see 8 percent of all block rewards go to the Zcash Community Grants (ZCG) organization to pay independent teams and individuals for Zcash-related work. This slice of the pie is essentially a carry-over from the current dev fund structure. However, starting in November, Electric Coin Co. (ECC) and Zcash Foundation (ZF) will no longer receive direct funding from block rewards. Instead, their respective 7 and 5 percent issuance will go into a lockbox where it will be designated for future decentralized grants funding. As stated in the ZIP: The disbursement of these funds will be governed by a mechanism to be determined by the community in the future, ensuring that the funds are released under agreed-upon constraints to maintain availability for years to come.

While the current Zcash dev fund was a four-year commitment, this new dev fund will be implemented to last for only one year. During this time, the Zcash community will decide whether to devise a different model and/or how to design a non-direct funding model where no organization is directly funded by block rewards.

 

The road to consensus on this hybrid dev fund was a remarkable community achievement. After multiple rounds of disparate, independent, and geographically diverse polling, the voice of the Zcash community was clear. 

ZCG member Jason McGee (@aquietinvestor) kicked off the conversation (and the question of what to do about a new dev fund) back in May of 2023, and as the year progressed several community members put forward ideas for new dev fund models:

As discussions — and a few good debates — took place in town halls, social channels, and the Zcash Community Forum, ZF made suggestions on how to poll the community on the content of these proposals. But there were members of the ecosystem who felt the formatting and wording of these polls did not take into account the wider diversity and will of the Zcash community. This activated a variety of groups and individuals to create additional polling and extend the reach to a wider swath of people.

In June of this year, the polling kicked off in earnest. Independent surveys went out to members of ECC’s ZAC, ZecHub DAO, ZF’s Zcash Community Advisory Panel, and ZURE. In addition, Jason McGee distributed polling to Russian, Spanish, and Portuguese-speaking communities.

The community also came together for the first-of-its-kind coin-holder voting via a Zcash wallet. Wallet developer Hanh, along with other community members devised the system for ZEC holders to vote and indicate which of the proposals they supported.

Though at times it was a messy process, with new polls seeming to be released every week, in the end, the community showed support for two proposals: 

In late July, with two proposals neck-and-neck, community groups distributed runoff polling. The clear winner was the Hybrid Deferred Dev Fund, as acknowledged by: 

The community’s work to get here has been incredible. And what lies before us is critical. ECC is building for a decentralized future that values individual privacy and consent, security, and human dignity. For that, the world needs usable digital cash, and we’re confident this community is ready.

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