The Zcash development fund has surged past $95 million on the back of ZEC's recent price rally, reigniting governance tensions over the fund's future.
Haseeb Qureshi, managing partner at Dragonfly, proposed winding down the fund when its mandate expires in 2028. "I'm of the opinion that this should be the final Dev Fund," he said in an X post Friday. Qureshi argued the fund is large enough to finance remaining development work and warned that approaching $100 million creates politicization risk.
At press time, the fund held 63,962 ZEC tokens, valued at approximately $95 million according to ZecStats, and remains outside active circulation pending governance approval for disbursement.
Matt Huang, founder of Paradigm, countered that the fund should continue, citing "AI cyber capabilities" and quantum computing advances as reasons to maintain it. Maxime Desalle, an investment analyst at Winklevoss Capital, took a harder line, proposing the Zcash community "completely get rid" of the development fund to resolve governance disputes. In a Sept. 9 post, Desalle argued the fund could compromise Zcash's security and replicate welfare-state dependencies.
Zcash founder Zooko Wilcox defended the fund's role, crediting the Zcash Community Grants Committee with helping Zcash "survive and grow to where it is today" in a Sept. 1 post. On Sept. 14, Wilcox clarified that the committee accounts for 40 percent of total development fund allocations.
The dev fund operates as a protocol development fund, accruing 0.1875 ZEC per block—12 percent of the total block subsidy under the NU6 upgrade.
Quershi also weighed in on governance mechanisms, favoring a partial model where token holders elect temporary councils over pure token holder voting. Huang agreed, cautioning that direct token voting could introduce "unpredictability that could limit long-term trust as a monetary asset" and suggested a hybrid governance approach.
