Zcash co-founder proposes ending grants funding, citing $125 million treasury

Zcash co-founder Sean Bowe proposed halting the automatic allocation of 8% of newly created ZEC to Zcash Community Grants (ZCG).

Bowe's draft proposal, published late Monday, suggests redirecting this share to the Network Sustainability Mechanism (NSM) for future miner rewards. The committee would retain its current assets and continue awarding grants from them.

Bowe's estimation places the existing assets at approximately $125 million, based on an illustrative ZEC price of $1,300, after factoring in outstanding grant commitments. He stated, "The program was never designed to handle this amount of funding."

The automatic allocation continues regardless of the committee's current holdings. At the network's target rate, it receives around 144 ZEC daily, equating to about $68 million annually.

The proposal arises amid scrutiny of a ZCG-funded outreach program that featured private payments at an adult-industry convention. The committee had approved startup funding and the first nine milestones, totaling about $461,500.

Bowe's draft does not reference the ZECsy grant, relying instead on the program's reserves and ongoing inflows. The proposal requires a modification to Zcash’s network rules but has no specified activation date.

The ZCG's five-member committee, chosen by a community advisory panel, selects grants without a separate coinholder vote. A separate funding program allocates 12% of new ZEC, where holders vote quarterly on its grants subject to participation and approval requirements.

Ian Miers, a founding scientist of Zcash, objected to the NSM as the destination, arguing the reserve ultimately pays miners and could be redirected later. Bowe responded that the reserve already exists and the issuance must go somewhere.