The Zcash community has voted to use 20% of its mining reward to develop infrastructure, as the Founder’s Reward systemexpires in a few months. This system was developed in 2016 and it ensured that 10 percent of the coin’s eventual supply is distributed to Electric Coin Company,the founding development company, until 2020. With the expiration date around the corner, developers now need to find other forms of funding.
Electric Coin Company ToDedicate Mining Rewards To Infrastructure Development
Electric Coin Company, a group dedicated to supporting the development of Zcash (ZEC), announced that its community members have voted to use 20% of their mining rewards from Zcash (ZEC) for infrastructure and marketing development.
This latest development was discussed because the Founder’s Reward is set to expire in November 2020, when the block 1,046,400 is mined. Afterwards, the ZEC miners will be entitled to only 80% of the block subsidy.
Zcash, which has been around since 2016, is a privacy-focused cryptocurrency that allows people to remain anonymous while making payments online. Similar to Bitcoin, Zcash has a limited coin supply of 21 million ZEC. The use of zero-knowledge proof transactions means that users can decide to make their transactions transparent or keep it shielded.
As the mining reward reduction approaches, the community is now looking at new ways of funding development. Zooko Wilcox, the creator of ZCash and CEO of Electric Coin Company (ECC), asked the community members to consider innovative ways of financing development.
His message, which was contained in a letter in August 2019, has so far received a positive response. Back then, he stated that, “I hope that the community will decide to renew the ‘Dev Fund’ structure, allocating coins from future block rewards for core support functions such as software development, user support, business development, regulatory and government outreach, security auditing and monitoring, educational and marketing initiatives, new protocol development, and so forth.”
A few days ago, ECC’s Josh Swihart pointed out that over the past four years, miners get 80% of the ZEC mining rewards. The investors and founders were given 15%, while the remaining 5% went to core development. The Founder Reward is set to expire in November, and the Zcash Foundation decided to ask the members to come up with new funding plans for growth.
The poll was recently concluded, and the members voted to establish a new development fund using 20% of the mining rewards. Swihart, while explaining the results of the poll, stated that the ECC would get 7% of the mining rewards from the development fund. The Zcash Foundation will receive 5% of the mining reward, while the remaining 8% will go to grants to support third-party Zcash efforts. He mentioned that, “Grant participants would receive the largest portion of development funds which will further decentralize Zcash-related efforts. Stipulations were also introduced for formal accountability and reporting requirements of each participant.”
Zcash Community Support Development Plans
Interestingly, the Bitcoin Cash founders had earlier taken a similar path and encountered challenges with their community members. However, things went differently with Zcash. Discussions on Reddit and Twitter saw different views from cryptocurrency enthusiasts regarding the move by the Zcash Foundation.
The core ZEC supporters on Reddit support the decision as they believe it is good for the cryptocurrency in the long run. Swihart thanked the community members for supporting the decision as it allows them to focus efforts on essential projects.