ZCG Withdraws Plan to Move 98,000 ZEC to Zcash (ZEC) Mining Rewards

ZCG Retires Its 98,000 ZEC Redirection Plan

The committee that hands out development grants on Zcash (ZEC) has stepped back from its own attempt to shrink the money it receives. Zcash Community Grants, or ZCG, said on Tuesday it would no longer pursue a plan, first floated on Oct. 29, to steer roughly 98,000 ZEC toward future mining rewards, writing that a change of this size belongs in Zcash's ordinary governance process rather than a committee's own gesture. The withdrawal came less than a week after the proposal appeared, closing the committee's most ambitious attempt yet to answer the question that has dogged the program for months: how much money is enough.

Under the network's emission schedule, the five-member committee receives 8% of every newly minted ZEC, roughly 144 coins per day, and it funds developer and community projects without putting each award to a coinholder vote. That intake has compounded into a treasury large enough to cover several years of work, which is what led developers and holders to ask why the flow continues unchanged.

The retired proposal would have rearranged both ends of that arrangement. It would have moved 36,200 ZEC out of ZCG's roughly 91,500-ZEC treasury into the Network Sustainability Mechanism, a reserve that gradually tops up the block rewards paid to miners, the same side of the ledger that funds the ASIC mining securing the network. It would also have trimmed the committee's expected income through the 2028 halving from about 109,000 ZEC to 47,000, with the taper deepening toward 2032. Every coin routed into the reserve is a coin that cannot be spent on development, and that arithmetic turned a bookkeeping fix into a fight over who controls Zcash's money and what it buys.

The ZECsy Episode Behind the Retreat

The retreat followed weeks of scrutiny over how the committee spends. In late October, ZECsy, a ZCG-funded outreach project, took private payments promotion to an adult-industry convention in New Jersey, and the booking became the flashpoint. Critics read it as evidence that the committee's spending had drifted from the network's priorities; supporters countered that sex workers, who routinely face banking restrictions, are exactly the people financial privacy is built to serve. Because the committee's five members face no holder vote on individual awards, critics framed the booking as an accountability gap rather than a one-off mistake.

The argument has since moved from the forum where grants are debated into the market itself, and it is now the dominant thread in Zcash governance circles. Our earlier reporting tracked a Big Z exit over the dispute that put the token near the $1,100 level, and a $14M whale position built ahead of the network's next hard fork, moves that landed as the token rose about 13.9% over the past 24 hours, keeping the privacy altcoin in bull market form while its treasury divides its own community.

The network's design explains why the fight is hard to settle. Zcash was created through the multi-party Zcash ceremony that generated its cryptographic parameters, and its issuance rules sit in the protocol, so a standing 8% allocation is difficult to change in code and gets contested in public debate instead. Money that arrives automatically keeps arriving until the rules are rewritten, which is why any lasting change requires a network upgrade rather than a committee's change of heart.

Three Proposals Wait on the Table

The withdrawal settles the mechanism, not the money. The committee has handed the question to Zcash's ordinary governance process, and the record there is already crowded. Sean Bowe has argued for ending ZCG's automatic funding outright; a draft ZIP he co-signed with Zcash founder Zooko Wilcox would send 50,000 ZEC to the Network Sustainability Mechanism and steer the committee's future intake into a new fund for development and legal defense; and developer Daira-Emma Hopwood would keep the 8% while refocusing grants on getting more people to actually use ZEC. None of the proposals has been adopted.

Any change to the split requires a network upgrade; the nearest one on the calendar, the NU7 hard fork, is scheduled to cut block time to 25 seconds on Nov. 5. Until a successor arrangement is adopted, ZCG keeps collecting about 144 ZEC a day, and with no replacement named, the treasury itself is holding the arrangement in the meantime.