Zcash Founding Scientist Challenges Bitcoin’s 21 Million Cap

StarkWare CEO Eli Ben-Sasson, a founding scientist of the privacy coin Zcash, challenged Bitcoin’s 21 million cap this week. He argued that lost private keys will steadily shrink the usable supply and proposed a 4% annual issuance limit instead.

The pushback was immediate, since Bitcoin supporters treat the fixed supply as the network’s founding promise. Zcash creator Zooko Wilcox answered with a rival design that keeps hard caps intact.

Why Ben-Sasson Says Bitcoin’s 21 Million Cap Fails

Ben-Sasson helped invent the STARK proof system now used across crypto and co-authored Zerocash, the 2014 design behind Zcash. His critique starts from the numbers on lost coins.

Chainalysis estimated that 2.78 million to 3.79 million BTC were already unrecoverable by 2017. The figure assumes Satoshi Nakamoto’s untouched coins are gone for good. Courts are still weighing dormant Bitcoin wallet claims worth $235 billion.

“Capping the supply of Bitcoin at 21M doesn’t make sense… In fact, as time goes to infinity, all keys will be lost. I strongly support a clear monetary policy with an absolute upper bound on the # of Bitcoins in the future,” he suggested.

He set the ceiling at 4% a year, roughly matching population growth. A steady flow of new coins would also keep paying miners after 2140, when Bitcoin stops minting rewards. Roughly 95.5% of all Bitcoin already exists.

Meanwhile, transaction fees near 2019 lows sharpen that concern, echoing earlier Bitcoin security budget warnings.

Zcash Answers With Burns and Formal Proofs

Wilcox pointed Ben-Sasson to Shielded Labs’ Network Sustainability Mechanism. Holders can voluntarily destroy their own coins, which the network later re-creates as miner rewards. Zcash’s own 21 million cap stays intact.

The numbers explain Ben-Sasson’s doubts. The mechanism proposes burning 60% of transaction fees, about 210 ZEC per year. He argued that sums that small cannot fund miners meaningfully, repeating that capping inflation beats capping supply.

Precedent cuts both ways here. Monero took the other path in 2022, adding a small permanent reward of 0.6 XMR per block. However, Bitcoin developers have repeatedly rejected similar ideas.

The Zcash camp is also attacking the opposite risk, secret inflation. Sean Bowe, the cryptographer behind Zcash’s major privacy upgrades, is building that proof under Tachyon. He said the work is close to showing that no hidden bug can secretly create coins in the new Ironwood pool.

Bitcoin advocates remain unmoved, echoing Michael Saylor’s argument that the network wins by refusing to change.

The proposal has almost no path to activation, yet it revives a question Bitcoin must eventually answer. Can transaction fees alone secure the network once the last rewards disappear?

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