• The most recently presented draft of ZIP 1012 provides for an upper limit on Zcash, which the Elecric Coin Company (ECC) is to receive in the future to promote external development projects.
• Due to the monthly limit and the denomination in US dollars, ECC sees a threat to the future growth of Zcash.

Zcash presented the roadmap for the further development of Zcash for the next 4 years in mid-November. The focus of development will be on interoperability, promotion of shielded addresses and decentralization through multi-party development. Furthermore, the Zcash Foundation recently conducted a vote on further funding of Zcash and presented a revised Zcash Improvement Proposal, ZIP 1012, based on the voting results.

This draft was initially well received by the community. Both the Electric Coin Company (ECC) and the Zcash Foundation are expected to share 20 percent of the Block Rewards to advance the development of the project. However, there is also one point of contention, namely the capped developer fund. In a statement published yesterday, the ECC criticized the monthly cap of $700,000 USD as it could hinder Zcash’s continued growth.

Monthly cap in US dollars must be removed

The Electric Coin Company sees a major problem in the fixed upper limit of 700,000 USD. The communication states that it is not possible to recruit talent from all over the world if there is a limit that is also defined in a fiat currency:

However, the Electric Coin Company currently does not see a path to succeed at recruiting and retaining a world-class team, and aligning them around the Zcash mission long-term, if we are constrained by a fiat-denominated funding cap. Unless the Electric Coin Company could find a solution to that issue, we would not accept the funds.

According to the ECC, if this problem cannot be solved, the result will be as follows:

• The ECC would not be able to use Zcash Coins as part of a package to attract skilled workers to recruit new staff.
• It would hinder the incentives for Zcash holders and employees.
• In addition, a fiat currency would find entry and mention in the constitution of the Zcash community.

The Zcash Foundation therefore states that there is an easy way to solve the problem. The fixed ceiling for funding external projects must be abolished and accountability for the use of funds enforced, as provided for in five of the six Zcash Improvement Proposals supported by the community.

The ECC is open to transformation into a not-for-profit association if the community claims that this would be best for incentive regulation and accountability. The community is currently discussing the new proposal, so it remains to be seen what further progress will be made.

Zcash course follows market trend

Zcash’s price has fallen by 4.54% to USD 27.59 in the last 24 hours, in line with current market sentiment. This means that Zcash has fallen by 50% since the beginning of the year until today.

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