Zcash co-founder Sean Bowe proposes ending ZEC grant funding, citing $125 million treasury

This share would instead be directed toward a reserve within the Network Sustainability Mechanism (NSM).

Under this draft proposal, the ZCG committee would retain its current assets and continue to approve grants from those holdings. Bowe estimates that these assets amount to approximately $125 million, based on an illustrative ZEC price of $1,300, after accounting for existing commitments.

Bowe stated on X, "The program was never designed to handle this amount of funding. It's time to turn off the ZCG funding stream. ZCG has over $125M in funding, and will receive millions more before the spigot is turned off."

The ZCG committee, which is elected by a community advisory panel, selects grants without a distinct coinholder vote. This proposal aims to prevent further accumulation of funds within ZCG's separate custody and governance structure, which Bowe argues introduces unnecessary risk given the substantial reserves.

The NSM is designed to support future mining rewards, and any redirected allocation would enter it, remaining there until the current grants stream concludes. The committee's dashboard indicated about 91,453 ZEC and $8.8 million, with $2.4 million already committed to recipients.

The automatic allocation continues regardless of the committee's existing holdings. At the network's established rate, ZCG receives about 144 ZEC daily, equating to roughly $68 million annually at the current coin price.

This proposal surfaced amidst scrutiny concerning a ZCG-funded outreach program that featured private payments at an adult-industry convention. The committee had approved startup funding and the first nine milestones for this effort, totaling about $461,500.

Market participants are observing this development as it relates to governance mechanisms within decentralized protocols, where the management of treasury assets and funding streams is a key area of regulatory and structural focus.

Why it matters

This proposal directly impacts the governance and future funding mechanisms of Zcash, a privacy-focused cryptocurrency. Changes to these allocations affect how network resources are managed and distributed among stakeholders. Regulators and exchanges watch such proposals closely as they signal shifts in decentralized autonomous organization operations.