Zcash co-founder seeks end to grants funding stream, citing $125M treasury

Zcash co-founder Sean Bowe has proposed stopping the automatic allocation of newly created ZEC to Zcash Community Grants, arguing the program has accumulated enough resources to continue supporting projects. His plan would redirect its 8% share of block subsidies to the Network Sustainability Mechanism, a reserve intended to support the network over time.

The proposal targets future funding rather than the grants committee’s existing treasury. Under the draft, assets already received by Zcash Community Grants, known as ZCG, would remain with the program, and the rules governing their management would stay unchanged. Ending the funding stream would therefore not, by itself, end grantmaking.

Figures cited in reporting on Bowe’s draft put the treasury at approximately 91,453 ZEC and $8.8 million in dollar assets, with about $2.4 million in outstanding grant commitments. Using an illustrative ZEC price of $1,300, the calculation values the balance after those commitments at roughly $125.3 million. That dollar figure depends on the assumed token price and should not be read as a fixed cash balance.

Bowe’s argument centers on whether automatic inflows remain necessary when a grants program already holds substantial reserves. Redirecting new allocations would separate the question of financing future projects from the question of continuing to build the treasury. The existing assets would still provide resources for grants, although their purchasing power would depend partly on ZEC’s value.

Zcash’s published Community and Coinholder Funding Model, ZIP 1016, describes two distinct channels for ecosystem support. It assigns 8% of block subsidies to ZCG and 12% to a separate Coinholder-Controlled Fund, giving the community and token holders different roles in funding decisions. The model provides for both streams to run until the network’s third halving.

Bowe’s draft would leave the separate 12% allocation and its duration unchanged, according to reporting on the proposal. The redirected ZCG share would instead be credited to the sustainability mechanism for the remainder of the grants stream’s existing term. This makes the proposal a change in the destination of future allocations, rather than a transfer of ZCG’s accumulated holdings.

The distinction matters for applicants and existing recipients because a recurring funding stream and an accumulated treasury serve different purposes. A treasury can finance ongoing awards without fresh allocations, but its longevity depends on spending, commitments and asset values. Bowe’s position is that ZCG’s present resources justify ending its automatic share, not that community projects no longer need support.

The proposal remains a draft, with no specified activation height, according to reporting on its contents. Implementing it would require a change to Zcash’s network rules; publication alone does not stop the allocation. The next question is whether the network adopts that change and, if so, when future ZCG funding begins flowing to the reserve instead.