Privacy needs
an exit option.

Frank Braun’s July 2025 thesis argues that Zcash could benefit if demand for financial privacy grows.

He connects private wealth storage and commerce to demand for privacy coins, arguing that longer-term shielded holdings and better wallet usability could reinforce adoption. His investment case also considers issuance, competition, and execution risk. [1]

I want competition to push protocol-funded rewards toward the minimum needed to deliver work users actually value.

A development organization should have to justify its cost, just as any other service provider does. When funding is embedded in consensus, a dissatisfied holder cannot simply cancel that allocation while continuing to use the same rules. Their alternatives are to persuade the network to change the rules, accept the arrangement, or leave.

A credible ZCL alternative could make leaving a meaningful choice. If users, capital, miners, and builders prefer a network without the same development allocation, that gives Zcash’s funding recipients a reason to ask for less, explain their budgets, and demonstrate why their work is worth supporting. The pressure would be strongest if useful work can be sustained with smaller allocations or voluntary funding.

This is what I mean by competing the reward down: make the cost of institutional funding visible and contestable. Buying ZCL does not mechanically lower a Zcash funding percentage. It supports the outside option that could make a lower percentage politically and economically attractive.

Zclassic describes its block rewards as going entirely to miners. That makes it a useful point of comparison, but it does not establish equal security, privacy features, or maintenance quality. A cheaper alternative must still work. [2]

A permanent funding stream can create pressure to produce a permanent roadmap.

My concern is an incentive mismatch. A funded organization must explain its budget, retain staff, and demonstrate progress. New protocol features produce visible milestones. Keeping a sound monetary rule unchanged produces fewer announcements, even when that restraint is more valuable to holders.

That can create a cycle: a budget supports a team; the team needs a roadmap; the roadmap proposes protocol changes; those changes create new implementation, audit, and maintenance work that supports the next budget. Nobody has to act dishonestly for this incentive to exist. This is my institutional critique, not evidence of any particular person’s motive.

For monetary rules, my starting point is continuity. Every change should overcome the costs of implementation risk, coordination, and weakening expectations that the rules will stay put. When the claimed improvement cannot clear that bar, leaving the protocol alone is the better outcome.

Doing nothing to issuance does not mean abandoning the software. Fix vulnerabilities, maintain nodes, improve wallets, and fund careful audits. Judge that work by user benefit and reliability, rather than the number of consensus changes shipped.

For issuance smoothing, my preference is to leave the established monetary schedule alone.

ZIP 234 is marked Draft in the text reviewed September 12, 2026. It proposes replacing stepped halvings with a subsidy calculated from the remaining money reserve, retaining the stated 21-million cap. It also enables future reissuance of funds deliberately removed from circulation through the NSM. Its authors argue this could soften mining-revenue shocks and support long-term security. [6]

Those are the benefits the proposal needs to establish. My objection is that the cap is only one part of a monetary commitment: the timing and conditions of issuance matter too. A familiar schedule gives holders and miners a rule they can plan around. Changing it spends some of that predictability and sets another precedent for revisiting monetary policy.

A smoother revenue path may appeal to miners and, wherever funding streams receive a share of the subsidy, to those recipients as well. That creates a reason to examine incentives; it does not prove that smoothing increases an organization’s total funding or that its authors proposed it for personal benefit.

In my assessment, retaining the existing schedule is better unless proponents show that the security benefit outweighs the implementation and credibility costs. An institution needing a new project is not a reason to change the money. A credible PoW alternative can reinforce that boundary by giving people who value restraint somewhere else to go.

Crosslink has a stronger case when the goal is better settlement assurance while keeping PoW mining.

The proposal adds stake-weighted finalizers alongside the existing PoW chain. Miners still produce blocks. Under the protocol’s security assumptions, finalized history gains protection against reorganizations. For an exchange crediting deposits or a merchant accepting payment, that could make settlement more dependable and reduce the need for long confirmation waits. Crosslink is a hybrid design, not itself a replacement of mining with full PoS. [8]

A more concrete benefit than changing the issuance curve

The distinction I find persuasive is between changing who can reverse settled history and changing when coins enter circulation. Crosslink targets the first problem; issuance smoothing targets the second. They are not interchangeable solutions. If rollback risk is the problem users actually face, stronger finality addresses it more directly than a different issuance schedule. That is a reason to evaluate Crosslink on its own merits, not to accept an entire upgrade bundle.

Pay for security with the existing subsidy

The April 2026 feature-net announcement models rewards as 40% for miners, 40% for stakers, and 20% for a development fund. This illustrates funding another security role by reallocating the subsidy. It is a proposed/test-network allocation, not a live-mainnet claim. [9]

The economic argument is that a given subsidy might buy better protection when it supports complementary mining and finalization roles. That benefit has to exceed the effect of reducing miners’ share. Staking rewards are a distribution of the security budget, not free additional wealth, and this design does not by itself compete down the development allocation.

Test whether finality keeps working

Nicolás Della Penna’s January 2026 mechanism-design audit found strong safety once finality is reached, conditional on BFT assumptions and PoW consistency. It also identified fragile liveness incentives and potential coordinated stalls in the reviewed baseline. Its findings concern a specific evolving design, not a blanket verdict on later versions. [10]

Shielded Labs’ May 2026 feature-net report describes finality stalls while PoW blocks continued, with recovery still under investigation. That is useful testing evidence, but it prevents me from treating dependable recovery as already established. [11]

Owning ZCL does not give me a veto over Zcash.

Zcash changes go through a proposal process and network adoption. The Foundation is an influential participant, not a unilateral switch for consensus rules. [3]

ECC’s published PoS research establishes that a transition has been explored. It does not establish that the Foundation can impose one, or that a particular proposal has activated. [4]

My concern is that tying consensus participation to stake can increase the importance of existing capital holders. That concern must be tested against the actual design. PoW has its own concentration and security tradeoffs.

A transparent-address rich list is possible. A list of every holder is not.

Transparent balances can be ranked from an indexed chain snapshot. One person may control many addresses; one exchange address may hold funds for many people. Shielded holdings cannot be ranked by public address.

No rich-list rankings or lost-supply estimate are published yet. The current explorer’s tested API does not provide a rich list; this view needs a complete address/UTXO index with spend history. Shielded balances would remain outside its coverage.

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