Zcash Grants Funding Could End: Co-Founder Says $125 Million Treasury Is Enough

Zcash grants funding could soon face its biggest change since the program began. Co-founder Sean Bowe has published a draft proposal to switch off the automatic stream of newly created ZEC that flows to Zcash Community Grants (ZCG), arguing the program is already sitting on far more money than it can sensibly spend.

Under the draft, released late Monday, ZCG’s 8% share of newly minted ZEC would be redirected into the Network Sustainability Mechanism, a reserve meant to support future mining rewards. The committee would keep everything it already holds and keep awarding grants from that pot. Because the allocation is built into the protocol, ending it would require a change to Zcash’s network rules.

The Numbers Behind the Proposal

Bowe puts ZCG’s assets at roughly $125 million after outstanding commitments, using an illustrative ZEC price of $1,300. The committee’s dashboard showed about 91,453 ZEC and $8.8 million in cash, with $2.4 million already promised to grantees. Those figures are consistent with his estimate.

The flow of new money is the bigger issue. At the network’s target pace, ZCG receives about 144 ZEC a day, or about $68 million a year at that same price. By contrast, the Financial Privacy Foundation, which administers ZCG’s funds, reported just over $1.5 million in program expenses in the first quarter, about $6 million annualized. That is less than a tenth of the annual inflow.

Bowe also stress-tested the case. If ZEC dropped to $500 and spending rose to $10 million a year, he estimates the treasury would still last about five years. In a post announcing the draft, he said the program “was never designed to handle this amount of funding.”

Governance and Risk

The proposal is as much about governance as arithmetic. ZCG’s five-member committee is elected by a community advisory panel and chooses grants without a separate coinholder vote. Bowe’s draft argues that continuing to pile money into that custody and decision-making setup adds risk when reserves are already large.

He does not want to end all ecosystem funding. A second program receives 12% of newly created ZEC, and holders vote on its grants every quarter. Bowe wants that allocation left alone. The redirected 8% would stay in the sustainability reserve for the remainder of the grants stream’s existing term.

Timing Draws Attention

The proposal arrived as a ZCG-funded outreach effort drew criticism. The team behind it, ZECsy, demonstrated private payments at an adult-industry convention in Edison, New Jersey, over the weekend. It had requested $550,000 for work spanning adult-industry events and crypto conferences. Bowe’s draft does not mention the controversy, and its case rests on the treasury’s size and the continuing inflow rather than any single grant.

Whether the community embraces the change is an open question. The draft still has to move through Zcash’s improvement-proposal process, and it would need to win support before any network-rule change could take effect. For now, the debate over Zcash grants funding turns on one question: whether a program with a $125 million cushion still needs a guaranteed stream of new coins.

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