Zcash Community Grants Proposes Redirecting 98,000 ZEC to Miner Reserve

The Zcash Community Grants (ZCG) committee released a proposal outline on Oct. 29 to taper its own block subsidy share and redirect roughly 98,000 $ZEC into the Non-Shielding Mining (NSM) reserve ¹. The move follows escalating community criticism that the grant arm receives more protocol funds than it can efficiently deploy ¹.

Under current network rules, ZCG receives an 8% share of each block reward ¹. Rather than leaving the grant pool intact or halting distributions abruptly, the committee proposed maintaining the overall 20% protocol development allocation while tapering grant payouts and transferring surplus funds to the NSM reserve ¹. Tokens routed to the NSM exit circulation and are gradually distributed to network miners across multiple decades to support long-term proof-of-work security as halving events reduce programmatic issuance ¹.

Governance Pushback and Subsidy Modeling

ZCG argued that alternative proposals to route developer funds into the NSM immediately through the 2028 halving would deplete reserve balances to between 20,000 and 49,000 ZEC by 2040 ¹. In contrast, the committee's phased model would continue depositing into the reserve through 2032, leaving over 200,000 ZEC available for miners by 2040 ¹. The trade-off requires miners to absorb an estimated 20% drop in earnings across 2029 and 2030, followed by projected earnings increases above baseline law starting in 2033—reaching roughly 10% higher in 2033, 30% in 2037, and 50% in 2041 ¹.

The announcement comes amid active community debates over protocol governance, including a separate Zcash draft proposal seeking to terminate the ZCG block subsidy allocation. Community members on the governance forum criticized the committee's compromise, arguing the model extends ZCG's mandate to 2032 without resolving broader coinholder frustrations regarding spending accountability ¹. At the time of writing, ZEC was trading around $1,253, down 1.2% over 24 hours.

ZCG stated that the preliminary post will be followed by a comprehensive draft detailing consensus mechanics, exact figures, and governance trade-offs before facing a formal community decision ¹.