The Zcash development fund has become a flashpoint for community governance after its value exceeded $95 million, following a rally in ZEC.
Haseeb Qureshi, managing partner at Dragonfly, proposed sunsetting the developer fund when its current rules expire in 2028. In a Friday X post, Qureshi argued the fund's $95 million balance is sufficient for remaining development work and carries growing risk of politicization as it approaches $100 million.
According to ZecStats, the fund holds 63,962 ZEC tokens at roughly $95 million. The balance accrues at 0.1875 ZEC per block—12 percent of the block subsidy under the NU6 upgrade—and remains outside direct circulation pending governance approval for disbursements.
Matt Huang, founder of Paradigm, countered the sunset proposal Wednesday, arguing the fund remains critical during advancing AI and quantum threats. Huang said direct token holder governance could inject "unpredictability that could limit long-term trust as a monetary asset" and backed a hybrid model combining additional oversight mechanisms.
Qureshi agreed on governance structure, opposing "pure token holder voting" in favor of a partial model where ZEC holders elect temporary councils to oversee the fund.
Maxime Desalle, investment analyst at Winklevoss Capital, offered a sharper position: eliminate the development fund entirely to resolve governance disputes. In a Sept. 9 X post, Desalle argued the fund could undermine Zcash's security and recreate bureaucratic dependencies.
Zooko Wilcox, Zcash founder, highlighted the Community Grants Committee—which accounts for 40 percent of the development fund—as essential to the protocol's survival and growth. Wilcox made the case in a Sept. 14 X post.
The current debate reflects broader protocol-level questions about long-term funding models. Zcash holders previously backed 25-second blocks and voted to maintain the existing ZEC halving schedule.
