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Merge pull request #1 from daira/ecc-zf-zip-1014-changes 

Editorial changes to Dev Fund ZIP
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@ -1,7 +1,7 @@
::
ZIP: 1014
Title: Dev Fund to ECC + ZF + Major Grants
Title: Establishing a Dev Fund for ECC, ZF, and Major Grants
Owners: Josh Cincinnati <josh@zfnd.org>
Zooko Wilcox <zooko@electriccoin.co>
Original-Author: Eran Tromer
@ -11,7 +11,7 @@
@dontbeevil
Daira Hopwood
George Tankersley
Status: Draft
Status: Proposed
Category: Consensus / Process
Created: 2019-11-10
License: MIT
@ -24,13 +24,27 @@ Terminology
The key words "MUST", "MUST NOT", "SHALL", "SHALL NOT", "SHOULD", and "MAY"
in this document are to be interpreted as described in RFC 2119. [#RFC2119]_
The term "network upgrade" in this document is to be interpreted as
described in ZIP 200 [#zip-0200]_ and the Zcash Trademark Donation and License
Agreement ([#trademark]_ or successor agreement).
The terms "block subsidy" and "halving" in this document are to be interpreted
as described in sections 3.9 and 7.7 of the Zcash Protocol Specification.
[#protocol]_
"Electric Coin Company", also called "ECC", refers to the Zerocoin Electric
Coin Company, LLC.
"Zcash Foundation", also called "ZF", refers to the 501(c)(3) nonprofit
corporation of that name.
Abstract
========
This proposal describes a structure for the Zcash Development Fund, to be
enacted in Network Upgrade 4 and last for 4 years. This Dev Fund would consist
of 20% of the block rewards, split into 3 slices:
of 20% of the block subsidies, split into 3 slices:
* 35% for the Electric Coin Company;
* 25% for Zcash Foundation (for internal work and grants);
@ -46,7 +60,7 @@ Motivation
==========
Starting at Zcash's first halving in October 2020, by default 100% of the block
rewards will be allocated to miners, and no further funds will be automatically
subsidies will be allocated to miners, and no further funds will be automatically
allocated to research, development, and outreach. Consequently, no substantial
new funding may be available to existing teams dedicated to Zcash: the Electric
Coin Company (ECC), the Zcash Foundation (ZF), and the many entities funded by
@ -116,13 +130,13 @@ Dev Fund allocation
-------------------
Starting at the first Zcash halving in 2020, until the second halving in 2024,
20% of the block rewards SHALL be allocated to a "Dev Fund" that consists of
the following three slices:
20% of the block subsidy of each block SHALL be allocated to a "Dev Fund" that
consists of the following three slices:
* 35% for the Electric Coin Company (denoted **ECC slice**);
* 25% for the Zcash Foundation, for general use (denoted **ZF-GU slice**);
* 25% for the Zcash Foundation, for general use (denoted **ZF slice**);
* 40% for additional "Major Grants" for large-scale long-term projects
(denoted **ZF-MG slice**).
(denoted **MG slice**).
The slices are described in more detail below. The fund flow will be implemented
at the consensus-rule layer, by sending the corresponding ZEC to the designated
@ -153,18 +167,18 @@ This obligation MUST be made irrevocable, e.g., within ECC's corporate
governance structure (i.e., its Operating Agreement) or contractual obligations.
ZF-GU slice (Zcash Foundation, for general use)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
ZF slice (Zcash Foundation's general use)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
This slice of the Dev Fund will flow to ZF, to be used at its discretion for
any purpose within its mandate to support Zcash and financial privacy,
including: development, education, support community communication online
and via events, gathering community sentiment, and external awarding grants
including: development, education, supporting community communication online
and via events, gathering community sentiment, and awarding external grants
for all of the above.
ZF-MG slice (Zcash Foundation, for major grants)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
MG slice (Major Grants)
~~~~~~~~~~~~~~~~~~~~~~~
This slice of the Dev Fund is intended to fund independent teams entering the
Zcash ecosystem, to perform major ongoing development (or other work) for the
@ -188,10 +202,10 @@ The funds SHALL be received and administered by ZF. ZF MUST disburse them as
substantial (current or prospective) continual existence, and set them up
for long-term success, subject to the usual grant award considerations
(impact, ability, risks, team, cost-effectiveness, etc.). Priority SHOULD be
given to Major Grants that support ecosystem growth through mentorship,
coaching, technical resources, creating entrepreneurial opportunities, etc.
If one proposal substantially duplicates another's plans, priority SHOULD be
given to the originator of the plans.
given to Major Grants that support ecosystem growth, for example through
mentorship, coaching, technical resources, creating entrepreneurial
opportunities, etc. If one proposal substantially duplicates another's
plans, priority SHOULD be given to the originator of the plans.
4. Major Grants SHOULD be restricted to furthering the Zcash cryptocurrency and
its ecosystem (which is more specific than furthering financial privacy in
@ -199,12 +213,12 @@ The funds SHALL be received and administered by ZF. ZF MUST disburse them as
5. Major Grants awards are subject to approval by a five-seat Major Grant
Review Committee. The Major Grant Review Committee SHALL be selected by the
ZF's (Community Panel) [#zf-community]_ or successor process.
ZF's Community Panel [#zf-community]_ or successor process.
6. The Major Grant Review Committee's funding decisions will be final, requiring
no approval from the ZF Board, but are subject to veto if the Foundation
judges them to violate the ZF's reporting requirements under U.S. IRS
501(c)(3) or U.S. law.
judges them to violate U.S. law or the ZF's reporting requirements and other
(current or future) obligations under U.S. IRS 501(c)(3).
7. Major Grant Review Committee members SHALL have a one-year term and MAY sit
for reelection. The Major Grant Review Committee is subject to the same
@ -218,7 +232,7 @@ The funds SHALL be received and administered by ZF. ZF MUST disburse them as
operate the Community Panel and SHOULD work toward making it more
representative and independent (more on that below).
ZF SHALL recognize the ZF-MG slice of the Dev Fund as a Restricted Fund
ZF SHALL recognize the MG slice of the Dev Fund as a Restricted Fund
donation under the above constraints (suitably formalized), and keep separate
accounting of its balance and usage under its `Transparency and Accountability`_
obligations defined below.
@ -236,7 +250,7 @@ are not accepted and disbursed by ZF, but rather directly assigned to the
grantees. Thus, the following mechanism MAY be used in perpetuity for some
or all grantees, if agreed upon by both ECC and ZF before NU4 activation:
Prior to each Network Upgrade, the Foundation SHALL publish a list of
Prior to each network upgrade, the Foundation SHALL publish a list of
grantees' addresses and the total number of Dev Fund ZEC per block they
should receive. ECC and ZF SHALL implement this list in any implementations
of the Zcash consensus rules they maintain. This decision will then be,
@ -250,7 +264,7 @@ Obligations
~~~~~~~~~~~
ECC, ZF, and Major Grant recipients (during and leading to their award period)
SHALL all accept the following obligations:
SHALL all accept the obligations in this section.
Ongoing public reporting requirements:
@ -297,7 +311,7 @@ conditions, and the prescribed use of funds, such that substantial violation,
not promptly remedied, will permit the other party to issue a modified version
of Zcash node software that removes the violating party's Dev Fund slice, and
use the Zcash trademark for this modified version. The slice's funds will be
reassigned to ZF-MG (whose integrity is legally protected by the Restricted
reassigned to MG (whose integrity is legally protected by the Restricted
Fund treatment).
@ -305,14 +319,14 @@ Future Community Governance
---------------------------
Decentralized community governance is used in this proposal via the Community
Panel as input into the Major Grant Review Committee which governs the `ZF-MG
slice (Zcash Foundation, for major grants)`_.
Panel as input into the Major Grant Review Committee which governs the
`MG slice (Major Grants)`_.
It is highly desirable to develop robust means of decentralized community
voting and governance --- either by expanding the Community Panel
or a successor mechanism --- and to integrate them into both of these
processes, by the end of 2021. ECC and ZF SHOULD place high priority on such
development and its deployment, in their activities and grant selection.
voting and governance –either by expanding the Community Panel or a
successor mechanism– and to integrate them into this process by the end of
2021. ECC and ZF SHOULD place high priority on such development and its
deployment, in their activities and grant selection.
ZF Board Composition
@ -359,9 +373,12 @@ References
==========
.. [#RFC2119] `Key words for use in RFCs to Indicate Requirement Levels <https://tools.ietf.org/html/rfc2119>`_
.. [#protocol] `Zcash Protocol Specification [Overwinter+Sapling+Blossom] <protocol/protocol.pdf>`_
.. [#trademark] `Zcash Trademark Donation and License Agreement <https://www.zfnd.org/about/contracts/2019_ECC_ZFND_TM_agreement.pdf>`_
.. [#osd] `The Open Source Definition <https://opensource.org/osd>`_
.. [#zip-1003] `20% Split Evenly Between the ECC and the Zcash Foundation, and a Voting System Mandate <zip-1003.rst>`_
.. [#zip-1010] `Compromise Dev Fund Proposal With Diverse Funding Streams <zip-1010.rst>`_
.. [#zip-1011] `Decentralize the Dev Fee <zip-1011.rst>`_
.. [#zip-1012] `Dev Fund to ECC + ZF + Major Grants <zip-1012.rst>`_
.. [#zip-0200] `ZIP 200: Network Upgrade Mechanism <zip-0200.rst>`_
.. [#zip-1003] `ZIP 1003: 20% Split Evenly Between the ECC and the Zcash Foundation, and a Voting System Mandate <zip-1003.rst>`_
.. [#zip-1010] `ZIP 1010: Compromise Dev Fund Proposal With Diverse Funding Streams <zip-1010.rst>`_
.. [#zip-1011] `ZIP 1011: Decentralize the Dev Fee <zip-1011.rst>`_
.. [#zip-1012] `ZIP 1012: Dev Fund to ECC + ZF + Major Grants <zip-1012.rst>`_
.. [#zf-community] `ZF Community Advisory Panel <https://github.com/ZcashFoundation/zfnd/blob/bdd3ec9434e90f436acc9655ece70f634cb47681/governance/community-advisory-panel.md>`_