Zcash Funding - Reading Assignment

[Devo]

1. What was Zcash’s original funding model, and why did it need to be replaced?
Founder’s Reward limit of 2.1 million ZEC (10% of total supply). 20% of block rewards taken from miners and diverted towards Zcash’s founders and investors along with some assistance for continued development.
It needed to be replaced as the founders/community support had split into two: the Electric Coin Company (ECC) and the Zcash Foundation.

2. Under the new funding model, how is the general community fund allocated?
Block mining rewards are split 80/20 between miners and the general community fund for coin development in a similar manner to the initial Founders’ Reward so 80% of the block rewards are still going to the miners but that other 20% is further split into three groups: 35% for the ECC, 25% for the Zcash Foundation and 40% for third-party developers.

3. Who was included in the final vote and why?
ZEC bag holders were included in the final vote as miners had not participated in the first voting round and the ZEC Foundation decided to not count miners’ votes in the second round.

4. What was ECC’s reason for rejecting an ‘upper-bound dollar limit’ on their block reward funding?
The event that “any cap would hamstring the organization’s ability to attract talent” they said.

[SweetNetworker]

1. It was funded by the community but overspending meant it could not support growth.

2. 80/20 : miners/general community fund
   20% pool split: ECC 35%, Zcash foundation 25%, Third party developers 40%

3. A 72 member community advisory panel. Of 112 elligible voters, 88 members cast ballots with overwhelming majority calling for continued funding.

4. Placing any limit would impede the organisations ability to attract talent.

[gunnarseay]

1.) Zcash’s original funding model was the Founder’s Reward, where 20 percent of the coins’ block rewards were taken from miners and diverted to its founders/investors. This funding model needed to be replaced because the developers wanted to ensure future funding for the coin and no longer rely on funding towards majority investors (which could be easily spent).
2.) Under the new funding model (ZIP 1014), the general community fund is split 80/20 percentage-wise between miners and a general community fund for coin development. The 20 percent pool is split further into three groups, including 35 percent to the ECC, 25 percent for the Zcash foundation, and 40 percent for third-party developers.
3.) The Zcash Community Forum, along with a 72-person community advisory panel, were included in the final vote for the new Zcash funding model; they were included in an effort to boost decentralization of the protocol.
4.) The ECC’s reason for rejecting an ‘upper-bound dollar limit’ on their block reward funding was due to the trouble this cap limit would cause when trying to recruit talented individuals. This veto unfortunately prevented further voices in the Zcash funding community to speak out against the ECC’s actions.

[jak]

What was Zcash’s original funding model, and why did it need to be replaced?

Zcash’s original funding model is that the founders would retain 2.1 million ZEC (or 10% of total supply). The expectation there was that if the protocol was successful and had a large community backing, the community would instead take of the protocol.

The ECC was spending too much and still required more funding after 2020.

Under the new funding model, how is the general community fund allocated?

A proposal was made (Zcash Improvement Proposal (ZIP) 1014) to split miner rewards, of which 20% would be allocated to a general community fund for Zcash development.

This 20% would be allocated to:

• 35% to the ECC,
• 25% to the Zcash Foundation, and
• 40% to third-party developers.

Who was included in the final vote and why?

Members from the Zcash community forum, and a 72 person community advisory panel were part of the final vote, which successfully enacted the 80/20 mining rewards.

Miners were left out of this vote, however - considering they had near-zero attendance in the previous ZIP proposal.

What was ECC’s reason for rejecting an ‘upper-bound dollar limit’ on their block reward funding?

The ECC said that placing a cap on the block-reward funding would be somewhat of a deterrence for attracting talent to work on the protocol.

[SDMRDEL7890]

1. What was Zcash’s original funding model, and why did it need to be replaced? : The Zcash’s Developer Fund also know as the Founder’s Reward, 20 percent of block rewards were taken from miners and diverted towards Zcash’s Founders and Investors with assistance for continued development Zcash Improvement Proposal 1014 split block mining rewards 80% / 20% between miners and general community fund for coin development similar to the initial Founder’s Reward.

2. Under the new funding model, how is the general community fund allocated? : 20% of the block rewards are split: 35% for the ECC, 25% for the ZCash Foundation and 40% for third-party developers.

3. Who was included in the final vote and why? : Zcash Community Forum along with a 72-person community advisory panel. Miners / “HODL’ers” were not eligible.

4. What was ECC’s reason for rejecting an ‘upper-bound dollar limit’ on their block reward funding? A hard cap would hamstring the organization’s ability to attract talent.

[hmpbkj]

1. Zcash originally had a funding model in which a portion of the block reward for mining new blocks on the network was set aside to fund the development and maintenance of the cryptocurrency. This funding model was implemented to ensure that there would be sufficient resources to support the ongoing development and growth of the Zcash network.

However, the original funding model was eventually replaced with a new funding model that was implemented in 2020. The new funding model introduced a general community fund, which is a pool of funds that is allocated to support the development and maintenance of the Zcash network. The general community fund is funded through a small percentage of the block reward that is set aside for this purpose.

2. The allocation of the general community fund is determined through a voting process that involves the Zcash community, the Zcash Company, and the Electric Coin Company (ECC). The final vote on the allocation of the general community fund is conducted by the Zcash Foundation, which is an independent organization that is responsible for overseeing the governance of the Zcash network.

3. The final vote on the allocation of the general community fund is open to all members of the Zcash community, including miners, users, and developers. The goal of this process is to ensure that the allocation of the general community fund reflects the needs and priorities of the broader Zcash community.

4. ECC rejected the idea of an “upper-bound dollar limit” on their block reward funding because they believed that such a limit would be arbitrary and could potentially restrict the flexibility and agility of the Zcash network. ECC argued that the block reward funding should be based on the actual needs and priorities of the Zcash network, rather than being limited by a predetermined cap.

[Joeyj007]

1. What was Zcash’s original funding model, and why did it need to be replaced?
   Known as the Founder’s Reward, 20 percent of block rewards were taken from miners and diverted towards zcash’s founders and investors along with some assistance for continued development. It needed to be replaced as it wasn’t sustainable.

2. Under the new funding model, how is the general community fund allocated?
   It splits block mining rewards 80/20 between miners and a general community fund for coin development in a similar manner to the initial Founder’s Reward. The 20 percent pool will be further split into three groups: 35 percent for the ECC, 25 percent for the Zcash Foundation and 40 percent for third-party developers.

3. Who was included in the final vote and why?
   Votes were cast by members of the Zcash Community Forum along with a 72-person community advisory panel. Of the 112 eligible voters, 88 members cast ballots with the overwhelming majority calling for continued funding.

4. What was ECC’s reason for rejecting an ‘upper-bound dollar limit’ on their block reward funding?
   The ZIP placed an upper-bound dollar limit on funding the ECC through the new block reward distribution. The company said any cap would reduce the organization’s ability to attract talent. As such, the ECC said it would not accept any proposal with similar constraints.