Zcash co-founder Sean Bowe has proposed ending the automatic funding stream for Zcash Community Grants and redirecting it to the Network Sustainability Mechanism. He says the program already holds over $125M. The proposal has no activation date.
Zcash co-founder Sean Bowe on Monday submitted a proposal to end automatic funding for the Zcash Community Grants (ZCG) program and redirect its remaining 8% share of block subsidies to the Network Sustainability Mechanism (NSM). Bowe filed the change as a draft Zcash Improvement Proposal.
According to Bowe on X: "The program was never designed to handle this amount of funding."
What ZCG holds today
The draft says ZCG holds 91,452.98 ZEC and approximately $8.8 million in U.S. dollar-denominated assets, against $2.4 million in outstanding grant liabilities. Bowe said the existing 8% allocation can yield over $68 million in ZEC annually, well above the $1.53 million in ZCG expenses that the Financial Privacy Foundation reported for the first quarter of 2026.
Another 110,049 ZEC is due to ZCG according to a dashboard linked on ZCG's website, before the stream ends on November 24, 2028.
How the redirect would work
If approved, the proposal would send the allocation to the NSM for the remainder of the existing funding stream's term without increasing Zcash's issued supply, per the draft. Bowe said ZCG would keep control of its existing assets and could continue approving grants and meeting outstanding commitments.
Under the draft, the NSM withholds the coins from issuance and starts paying them back out as block rewards in February 2031. Bowe said a separate 12% allocation to the Coinholder-Controlled Fund would stay unchanged.
Finally, the proposal is not included in the currently specified NU7 network upgrade and would need a future upgrade to take effect.
Sources: The Block, CryptoPotato
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