Zcash co-founder Sean Bowe has proposed ending the automatic funding stream for the privacy network’s community grants program, arguing that its treasury is now large enough to fund years of spending without any new money coming in.
Zcash (Credits: CoinDesk)
Zcash Co-Founder Proposes Ending Grants Funding, Citing $125 Million Treasury
Bowe’s draft proposal, published late Monday, would halt the automatic allocation of 8% of newly created ZEC to Zcash Community Grants and redirect that share into a reserve for future mining rewards. The committee would keep the money it has already received and continue awarding grants from its existing assets.
According to Bowe’s calculation, those assets stand at about $125 million after outstanding grant commitments, based on an illustrative ZEC price of $1,300. On that basis, he argues, the program could keep funding work for years even if ZEC’s price falls substantially, and it will receive millions more before the funding stream is actually turned off.
“It’s time to turn off the ZCG funding stream,” Bowe wrote, adding that the program was never designed to handle this amount of funding. The proposal would require a change to Zcash’s network rules, so it is a draft for community discussion rather than a done deal.
Why the Zcash Grants Proposal Matters
Community grants programs are a common way for crypto networks to fund development, outreach, and ecosystem work. Instead of relying on a company or a single foundation, a slice of newly created tokens flows automatically to a grants committee, which then awards it to projects it judges worthwhile.
Bowe’s argument flips the usual logic of such programs on its head. The question, in his framing, is not whether grants are valuable, but whether an automatic stream should keep running once the treasury is already large. If the committee already holds roughly $125 million after its commitments, he suggests, new inflows are no longer needed to keep the program alive.
The proposal comes amid scrutiny of a grant for outreach at an adult-industry convention, CoinDesk reports, though Bowe’s case rests on the size of the reserves and the continuing inflows rather than on any single grant. Redirecting the 8% share to a reserve for future mining rewards would also change the incentives around Zcash’s long-term security model, since mining rewards are the payments that keep the network running.
What Happens Next for Zcash Community Grants
For now, nothing changes automatically. A change to Zcash’s network rules needs community agreement, and the draft proposal is the opening move in that debate. Supporters of the grants program may argue that a large treasury is a reason to fund more ambitious work, not less, while supporters of Bowe’s plan will point to the risk of a program growing beyond what it was designed to handle.
Either way, the numbers at the heart of the debate are unusually concrete for a crypto governance argument: about $125 million already in hand, an 8% share of new ZEC still flowing in, and a decision about whether that tap should stay open. How the Zcash community answers that question will shape how the privacy network funds itself for years to come.
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Source: CoinDesk — read the full story there.
