🌎 Zcash Allocates 20% of Block Rewards to Decentralized Grants

The Zcash crypto community has approved a proposal to allocate 20% of block rewards to a new decentralized grants system. This initiative aims to enhance development efforts across the ecosystem.

This decision follows a poll conducted among the Zcash Community Advisory Panel, focusing on the future of the Zcash Development Fund, which is set to expire in November. According to a blog announcement from the Zcash Foundation, the favored proposal, the “Lockbox for Decentralized Grants Allocation,” received 14% “strongly approve” and 34% “approve” votes, securing a cumulative approval of 63%, significantly outpacing other options.

The proposal directs 20% of Zcash block rewards into a trust, with funds accumulating until a decentralized voting and signature mechanism is established for disbursement. While this transition offers various benefits, it also poses challenges. These include the need for Zcash’s current development fund organizations to adapt to the new model and the technical complexities of creating a secure, decentralized disbursement mechanism. The proposal’s author, under the alias “skyl,” highlighted these challenges in a forum post.

This vote follows the Electric Coin Company’s (ECC) announcement of a shift in the funding approach for the Zcash cryptocurrency. The ECC is moving away from direct protocol funding and advocating for decentralization. The Colorado-based company expressed concerns about the current funding model, referring to it as the “dev tax,” and emphasized the importance of community-driven initiatives to shape the future of Zcash.