Zcash Grants Group Proposes $46M Treasury Redirect Amid Governance Backlash
Key Takeaways
- •ZCG proposed transferring 36,200 ZEC, worth roughly $46 million, from its approximately 91,500-ZEC treasury to the Network Sustainability Mechanism, which reserves coins for future mining rewards.
- •Combined with forgoing about 62,000 ZEC in future allocations and tapering remaining funding until the 2032 halving, the plan would redirect roughly 98,000 ZEC, or about $124 million, toward future block rewards.
- •If approved, the committee would retain about 55,200 ZEC, worth approximately $70 million at the time of writing, with its automatic allocation currently scheduled to end in 2028.
- •Helius CEO Mert Mumtaz called the proposal 'nowhere near good enough,' and Gemini co-founder Tyler Winklevoss questioned the committee's accountability over the fund.
- •The new plan goes further than an earlier proposal by Zcash co-founder Sean Bowe, which would have ended ZCG's automatic 8% share of newly issued ZEC while leaving the existing treasury untouched.
Zcash Community Grants (ZCG) has proposed redirecting roughly $46 million in Zcash (ZEC) tokens from its treasury toward future block rewards, drawing criticism from industry figures demanding greater accountability over the fund.
On Thursday, ZCG outlined the plan in a community forum post, proposing to transfer 36,200 ZEC from its roughly 91,500-ZEC treasury to the Network Sustainability Mechanism (NSM), which reserves coins for future mining rewards. If approved, the committee would retain about 55,200 ZEC, worth approximately $70 million at the time of writing. The transfer would move tokens out of a committee-controlled account and into a reserve earmarked for miners, shrinking the pool ZCG directly manages.
The group also proposed forgoing about 62,000 ZEC ($78.5 million) in future allocations and tapering its remaining funding until the 2032 halving. Taken together, the changes would redirect about 98,000 ZEC, or roughly $124 million, toward future block rewards.
Under the current arrangement, ZCG's automatic allocation is scheduled to end in 2028. The alternative would extend reduced funding for another four years. ZCG described the plan as preliminary, with a full proposal to follow for community consideration. At stake is how Zcash's grant funding operates: through automatic allocations from newly issued ZEC, as now, or through arrangements more directly accountable to ZEC holders.
Helius co-founder and CEO Mert Mumtaz called the proposal “nowhere near good enough,” saying the treasury was already too large and arguing that funding decisions should be accountable to ZEC holders.
Gemini co-founder Tyler Winklevoss also questioned the committee's accountability after Mumtaz said a committee member had unfollowed him on X. Winklevoss said such behavior made someone unqualified to oversee $110 million.
The criticism follows an earlier proposal by Zcash co-founder Sean Bowe to end ZCG's automatic 8% share of newly issued ZEC and redirect it to the NSM while leaving the existing treasury untouched. The new ZCG plan goes further in one respect: it draws down the treasury itself, transferring 36,200 ZEC that Bowe's proposal would have left in place.
Related: A Winklevoss-backed Zcash ETF has filed with the SEC for a Nasdaq listing.
