Zcash community approves proposal to allocate 20% of block rewards toward grants

The Zcash crypto community has approved a proposal that would allocate 20% of block rewards to a new decentralized grant system aimed at boosting development initiatives across the ecosystem.

This decision was made following a survey among the Zcash Community Advisory Panel, focusing on the future of the Zcash Development Fund, which is scheduled to expire in November.

According to a blog post by the Zcash Foundation on Monday, the preferred proposal, “Lockbox for Decentralized Grant Allocation,” received 14% “strongly approve” and 34% “approve,” for a total approval rating of 63% and significantly outpacing other options.

Voting results for Zcash funding proposals | Source: Zcash Foundation

The proposal calls for 20% of Zcash block rewards to be transferred to a foundation, with funds accumulating until a decentralized voting and signature mechanism is established for distribution.

Despite some benefits, the transition presents challenges, including the need for Zcash’s existing development funding organizations to adapt to the new model and the technical complexities of establishing a secure, decentralized distribution mechanism, the proposal’s author, who goes by the pseudonym “skyl,” noted in a forum post.

The vote comes after the Electric Coin Company (ECC) announced a change in its funding approach for its Zcash cryptocurrency, moving away from direct protocol funding and advocating decentralization. The Colorado-based company expressed concerns with the current funding model, calling it a “developer tax,” and stressed the need for community-driven initiatives to shape the future of Zcash.