Zcash Grants Proposes $124M for Block Rewards as Backlash Grows

Zcash Community Grants has proposed redirecting about 98,000 ZEC, roughly $124 million, toward future block rewards. Industry figures answered with sharp criticism and demands for accountability. No vote is scheduled yet, since the committee promises the full proposal later.

What the committee proposed

On Thursday, Zcash Community Grants (ZCG) proposed moving 36,200 ZEC out of its treasury of about 91,500 ZEC into the Network Sustainability Mechanism (NSM). That mechanism reserves coins for future mining rewards. If approved, the committee would keep about 55,200 ZEC, worth roughly $70 million at current prices.

The second part concerns future payments. ZCG is ready to forgo about 62,000 ZEC ($78.5 million) in scheduled allocations and taper its remaining funding until the 2032 halving. Together the changes would send about 98,000 ZEC to block rewards.

Under the current setup, ZCG's automatic allocation ends in 2028. The new scheme would extend reduced funding for four more years.

Who criticized the plan and why

Helius co-founder and CEO Mert Mumtaz called the proposal "nowhere near good enough." In his view the treasury is already too large, and spending decisions should be accountable to ZEC holders.

Gemini co-founder Tyler Winklevoss backed the accountability complaints. He said a committee member who unfollows a critic on X is unfit to oversee $110 million. Mumtaz had earlier said one ZCG member unfollowed him.

The criticism is not new. Earlier, Zcash co-founder Sean Bowe proposed ending ZCG's automatic 8% share of newly issued ZEC and sending it to the NSM, while leaving the existing treasury alone.

How the two approaches differ

The proposals treat money that has already been collected in different ways.

• Bowe's plan stops the future 8% of issuance and leaves the ZCG treasury intact.
• The ZCG compromise gives up part of the treasury and 62,000 ZEC of future inflows.
• Critics want decisions to depend on coin holders, not on a closed committee.

ZCG stressed that the current version is preliminary and a detailed proposal will go to the community.

What is known so far

No final decisions exist. The committee must publish the full text before the community can vote. For Zcash holders, the amount that ends up in block rewards depends on how the accountability dispute plays out. According to Cointelegraph, ZEC trades near $1,250.