TheBlock
Zcash co-founder Sean Bowe has proposed ending automatic funding for the Zcash Community Grants program and redirecting its remaining 8% share of block subsidies to the Network Sustainability Mechanism. Bowe said ZCG holds 91,452.98 ZEC and about $8.8 million in dollar-denominated assets, against $2.4 million in outstanding grant liabilities.
Why it matters
Bowe wrote that ZCG has more than $125 million in funding and could receive millions more before the allocation ends. Under the current model, the 8% share can generate more than $68 million in ZEC annually, compared with $1.53 million in ZCG expenses reported by the Financial Privacy Foundation for the first quarter of 2026.
The proposal would redirect the allocation for the remainder of the existing funding term without increasing Zcash's issued supply. ZCG would retain control of its current assets and could continue approving grants and meeting outstanding commitments. A separate 12% allocation to the Coinholder-Controlled Fund would remain unchanged.
Market impact
The proposal has no assigned activation height and is not part of the currently specified NU7 network upgrade. It would require a future network upgrade, leaving the timing and outcome in the hands of ZEC governance.
ZEC traded around $1,248 on Tuesday, up 2% over 24 hours. The debate puts network funding efficiency, treasury deployment and long-term sustainability at the center of the next governance decision.
Frequently asked questions
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What change did Sean Bowe propose for Zcash funding?
Bowe proposed ending automatic funding for the Zcash Community Grants program and redirecting its remaining 8% block subsidy share to the Network Sustainability Mechanism.
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How much does ZCG currently hold?
ZCG holds 91,452.98 ZEC and approximately $8.8 million in dollar-denominated assets, against $2.4 million in outstanding grant liabilities.
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How large is the current ZCG allocation?
The existing 8% allocation model can generate more than $68 million in ZEC annually, compared with $1.53 million in reported ZCG expenses for the first quarter of 2026.
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Would the proposal increase Zcash's issued supply?
No. The draft says redirecting the allocation to the Network Sustainability Mechanism would not increase Zcash's issued supply.
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When could the proposed change take effect?
The proposal has no assigned activation height and is not included in the specified NU7 upgrade. It would require a future network upgrade to take effect.
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