The Zcash community has spoken, and the future of funding for this privacy-focused cryptocurrency is about to change in a big way! Get ready for a more decentralized and community-driven approach to project development.
Zcash Community Approves Decentralized Grant Allocation
The Zcash community has overwhelmingly approved a proposal to allocate 20% of block rewards to a new decentralized grants system. This decision marks a significant shift towards greater community involvement and transparency in funding future development. The proposal, known as the “Lockbox for Decentralized Grants Allocation,” garnered approximately 63% of the community’s support.
This move was prompted by the upcoming expiration of the Zcash Development Fund in November, leading the Zcash Community Advisory Panel to poll the community on future development strategies.
According to the official statement:
“Under the Majority Choice Approval (MCA-M or Modified Bucklin) voting method, the winning proposal is the Lockbox for Decentralized Grants Allocation (20% option), which directs 20% of the block rewards to a lockbox for future disbursement based on community polling results.”
Kris Nuttycombe, the proposal’s author, emphasized that the new decentralized development fund will focus exclusively on grants. The allocated funds will accumulate until the new system is fully operational and ready for disbursement.
What Does This Mean for Zcash?
Unlike the current system, which involves direct funding, the decentralized system will empower the community to vote on which projects receive funding. This shift aims to foster a more open and accountable ecosystem.
Key Benefits of the Decentralized Funding System:
- Increased Community Involvement: Community members will have a direct say in how development funds are allocated.
- Enhanced Transparency: The voting process will be transparent, ensuring accountability in fund distribution.
- Greater Decentralization: Moving away from direct funding promotes a more decentralized development model.
A Word from the Electric Coin Company
Josh Swihart, CEO of Electric Coin Company, highlighted the significance of this shift for Zcash:
“The Zcash community wants change and will move from its legacy direct-funding model to a new, more open option, fostering greater decentralization and accountability.”
https://twitter.com/jswihart/status/1812958696059904478
He further noted the community’s strong support for holding development funds in a “lockbox” until a new distribution mechanism is established.
The Alternative Proposal
Another proposal suggested allocating 12% of the block reward to a lockbox. Additionally, 8% of the block subsidy would be directed to the Financial Privacy Foundation (FPF) for the Zcash Community Grants Committee (ZCG) to fund independent teams within the Zcash ecosystem.
More details on this alternative proposal can be found here.
Zcash: A Privacy-Focused Blockchain
Launched in October 2016, Zcash is built on Bitcoin’s codebase and maintains a fixed supply of 21 million coins. Its primary focus is on providing users with enhanced privacy features.
In Conclusion
The Zcash community’s decision to embrace a decentralized grant allocation system marks a pivotal moment for the cryptocurrency. By empowering the community to vote on funding decisions, Zcash is taking a significant step towards greater decentralization, transparency, and accountability. This move not only ensures a more inclusive development process but also strengthens the long-term sustainability of the Zcash ecosystem. As the new system rolls out, it will be exciting to see the innovative projects that emerge from this community-driven funding model.
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