The five-person Zcash Community Grants (ZCG) committee has drawn criticism from people calling out the $46 million it wants to return of the roughly $125 million in its treasury as too small.
The 8% allocation of block rewards flowing into the treasury became worth fighting over after the recent 48-fold explosion in ZEC’s price over the last three years caused the funds to balloon in value.
Notably, the Zcash community has still not reached consensus on the best path to reroute the funds into. One of the more popular proposals to hand over control to coinholders has its detractors, who note that the people pushing the idea also stand to gain the most from concentrating power in the hands of the largest ZEC holders.
What solution did the ZCG propose?
The ZCG committee proposed moving 36,200 ZEC (worth about $46 million) from its roughly 91,500-ZEC treasury into the Network Sustainability Mechanism (NSM) in a Zcash community forum post , where it also conceded that the current 8% allocation it receives is more than it needs.
The Financial Privacy Foundation reported that ZCG spent only $1.53 million in Q1 2026.
The Network Sustainability Mechanism, as Cryptopolitan reported , is a protocol reserve that temporarily removes ZEC tokens from circulation and pays them to miners later over decades.
Another 62,000 ZEC ($78.5 million) in future funding was committed by the ZCG crew, with ongoing plans to continue to taper the remaining funds until the 2032 Zcash halving event. The current 8% allocation to the ZCG treasury runs until at least 2028.
Over time, the ZCG’s proposal to send ZEC to the NSM would amount to 98,000 ZEC (about $124 million) in future rewards for miners.
Why the Zcash community is fighting over $125 million
Under present rules, ZCG receives 8% of block rewards while the Coinholder-Controlled Fund receives 12%. The ZCG is controlled by the five-person committee, while token holders vote on the latter every quarter.
Block subsidy allocation for non-direct development funding. Source: Zcash
The allocation dispute centers on the nearly $125 million figure that Zcash co-founder Sean Bowe cited, quoting the ZCG’s public dashboard, which lists 91,452.98 ZEC and about $8.8 million in dollar-denominated assets against $2.4 million in outstanding grant commitments.
With all that money at stake, the Zcash community is facing competing proposals, pushing to send the ZCG’s funds in different directions.
Helius co-founder Mert Mumtaz dismissed ZCG’s refund plan as “nowhere near good enough” on X, calling the treasury “gargantuan” and arguing spending should answer to ZEC holders rather than a committee they had no hand in picking.
Gemini co-founder Tyler Winklevoss backed Mumtaz on Friday, saying that anyone who “can’t even take a little scrutiny” was “not qualified to run 110 million dollars with no accountability.” The response came after the Helius co-founder posted that a committee member had unfollowed him.
Direct holder control has skeptics inside the industry too. A token-weighted vote favors the largest wallets, and several of the people demanding the change are among the biggest stakeholders.
Dragonfly managing partner Haseeb Qureshi, who in September called for winding down the dev fund after it expires in 2028, argued against letting ZEC holders vote directly on allocations. Paradigm co-founder Matt Huang argued the same position. Both favored some form of elected council over a raw coin vote.
Maxime Desalle, an investor at Winklevoss Capital who has disclosed he is “actively involved with Cypherpunk, the world’s largest Zcash miner,” wants ZCG abolished outright.
The current fight follows Bowe’s narrower October 26 proposal to switch off the 8% stream and divert it to the NSM while leaving ZCG’s treasury untouched, which split Zcash’s own co-founders.
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