Development/Community fund percentage after Block halving

Currently Zcoin is set to undergo it’s first block halving in 2020.

This also means that officially, Founder’s Rewards and Dev Fund ends.

If we do nothing, the block reward will be distributed as:

70% Miners
30% Znodes

This means that there will be no development fund and we have to rely on open source contributions or donations to proceed.

I would like to hear if our community is okay with this or should we retain a dev or community fund of some sort to continue to fund development past the end date.

My personal preference is that

10% Dev/Community Fund
60% Miners
30% Znodes

Second question is what happens if the funds are not fully allocated, should they be burnt? Or should there be a default address it goes to? Or to miners/znodes?

We also have to consider that we don’t want to create a disincentive for miners/znodes to fund development to reward themselves as well.

The percentage allocation is an independent discussion from the mechanism of allocation of the dev/community fund which is being discussed here: Zcoin Governance and Development past 4 years

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I agree with 10-60-30.

As for the second question, I believe it should be one of these two:
Go into the dev fund, or
Accumulated in the community fund.

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Community fund sounds fine.
If no funds is allocated there will be no longer be an active development for Zcoin and we aint there yet.
2nd question
if the funds is not spend 100% i suggest to set it aside for some kind of emergency funds with a hard cap.
Once this cap is reached
we have advertising and chairity to spend and bring Zcoin to the attention of the Mass. If you set a monthly cap for those chairity funds too.
Excessive funds still can be controlled to share with miners or nodes in case we have a massive bull run in the near term and only need a few zcoins to pay all our expenses.

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  1. 10-60-30.
  2. Leave money to the team Zcoin

Best regards

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10-60-30 is a good mix and seems reasonable

if funds are not fully allocated they should go back into the mix for miners and znodes

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Personally, I think the devs are doing a great job with this project. There is still a lot of stuff to do before crypto becomes mainstream. Development has to keep going or the project will fade away.

Please sell us a future road map!
It will be a no-brainer for people to accept whatever funding when a nice roadmap is laid out.

For example: Give the world a streamlined voting mechanism (like the Thai use case). That would be a killer app that will catapult the hype and token value. Imagine the amount of spending around the world for all current public voting. Zcoin may corner this market if momentum is kept up.

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Agree with 10-60-30 split.

Will znode owners vote on funding proposals, as in other masternode networks? If so, giving unallocated funds back to them will disincentivize them to vote ‘yes’ on proposals. Therefore, I believe remaining funds should go to the devs or be burnt.

I agree with the 10-30-70 split.

Breaking down the 10% further, how about 8% for dev and 2% for community for the purpose of voting on things that could bring more awareness to Zcoin sort of similar to voting on marketing or charity project the way dash does.

You guys do great work and definitely want to make sure you’re all compensated for continuous work as the road map is ambitious. The dev fund also includes research right? If not then 5% dev 4% research for Lelantus and others with 1% community/emergency fund.

I am divided on this point. There is a founder reward. Some portion of that goes to the Team and bounty wallet. If there is going to be an allocation of any amount after the four years towards the Team and bounty, I would have to need more information.

I don’t know if the information is available but I would like to know how the funds are being used. I believe that this is the address of the team and bounty wallet that is being used to allocate the 3 XCZ per block a1HwTdCmQV3NspP2QqCGpehoFpi8NY4Zg3. Please correct me if I am wrong.

If the team has used all the funds that was allocated towards them, c’est ca. If the team however is running nodes, then I think the problem at hand could be viewed from a different angle.

Ideally I think that the team should have a certain amount of nodes that can generate a steady form of revenue. These funds can then be used to undertake challenges and projects.

After the halving, with an allocation of 10%, the team would take a setback from 3.0 XZC to 2.5 XZC. On the other hand that would still be 0.5 XZC higher than the previous 2.0 that was allocated towards the Team and bounty wallet.

Bear in mind that this is per block. That would mean that in the upcoming two years 250K+ XZC will be allocated towards the Team and bounty wallet. After the halving the team would get around 130K XZC per year for the then upcoming four years. Again please correct me if I am wrong.

In the case that it is an absolute must I think we should keep the 14% to generate a certain amount of Team and bounty nodes. After that the 14% could be divided amongst miners and nodes.

I also think there is no way to bypass that this would need to be organized centrally in the form of a foundation or something similar. I am no expert on this and I am eager to hear other people’s opinion on this.

Also how are the funds being managed right now? How many members of the current team would leave if there are no reward? How many team members are running nodes themselves and how much are they incentivized to work on the project?

I am personally not fond of the idea of developers having to run nodes. Node returns are also not as predictable as they depend on the number of nodes on the network. But the main thing is I don’t want to create a system where Zcoin infrastructure is dependent on the Zcoin team maintaining it and should be on our own personal capacity. Also incentives are not aligned as i detail further.

I don’t want to give exact breakdown of how the dev wallet is used for competitive reasons but let’s say if Zcoin is at 5 dollars we’ll be running roughly break even at about USD64,800 a month. With the recent boost we’re doing much more comfortable but still it’s lean.

Consider that we have significant amount of full time members (8 members) along with semi-full time (3 members).

6 operations/community support/marketing members (4 full time)

and cryptographic research, PR team, server infrastructure and tools, office space…I can say that we’re a super lean team. Many of us are taking cuts in our salaries too with the downturn because we really believe in the project. These team members will expect rises in the salary to reward their commitment if the price increases as they deserve.

Our research funding and other activities such as conference attendance/community building are coming from our reserves that we accumulated in better times. Note that during better times, exchange listings and many other services cost a lot!

Now consider that a silicon valley programmer costs about 250-500k USD a year this means that other projects might just higher 3-5 programmers for the same price :smiley:

If there is no reward, a big majority of our team will leave as the salary is their source of income. Znodes alone at current prices are not enough to sustain life and if they were enough, then there’s a huge centralization of ownership problem. Most are full time jobs and none of us are super rich and need to support our life and families.

A znode currently gets 90 dollars a month and after halving this will go down 45 USD provided that there are no new Znodes and price is the same.

Also it is unfair to have some people reaping benefits just by virtue of owning while others have to work hard for it. Expecting people to work seriously for free or rely on donations (such as Grin) or to boost their bag is a poor way to fund consistent development and opens us to outside influence. Even Bitcoin heavily relies on paid development by Blockstream which has questionable motives. I rather have a fund that funds development transparently but if we don’t do well or don’t deliver results, we can be replaced which keeps us honest.

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Dev fund includes research yes!

The drawback I see to being too specific on the percentages is that it limits flexibility depending on market situations. For e.g. in tough times, we may need to scale down research and promotion to keep development running. In better times priorities will shift.

With a fund I think monthly reports on the allocation HAS to be delivered, like what percentage of the fund went where so that will have some degree of accountability. A third party ‘auditor’ can perhaps also certify this report.

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This is still in discussion as to how the funds are voted in and is in this thread: Zcoin Governance and Development past 4 years

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