Privacy coin Zcoin (XZC) has revealed the new block reward distribution that the project will introduce after more than a year of community discussion after its September halving, and diverted to development funding.
The new redistribution will see 15 percent of all block rewards diverted to development funding to be used in network infrastructure and core development including research into new privacy protocols and development of wallets.
Zcoin Publishes Post-Halving Block Reward Allocations
After halving in September 12.5 XZC per block will be produced. 50% or 6.25 XZC will be distributed to miners, while 35% of 4.275 XZC will go to Znodes and the remaining 15% or 1.875 XZC will go to the Development Fund of Zcoin.
The community will review the allocation of funds to development “to assess its need and amount” after two years — with discussions on the topic set to start 18 months after halving.
At present, only 6% of the 25 XZC mined per block is diverted to the Development Fund, with 8% going to founders and seeds, 30% going to Znodes and 56% going to miners.
Zcoin Introduces Reserve Fund
The upgrade will also introduce the Zcoin Reserve Fund, which will absorb all XZC diverted the Development Fund once the balance of said fund exceeds $100,000 — with a limit set to increase by 4 percent annually to counter inflation.
Coins held by the Reserve Fund can only be deployed by consensus within the community. Reserve funds will be used exclusively to pay for bug bounties, to cover shortfalls in the development fund should XZC’s price fall below $3.50, and other community-approved initiatives.
Zcoin Project Steward Reuben Yap stated that discussions began during March 2019 regarding the allocation of post-halving block reward.
Yap stated that it was “gathered via forum posts, Telegram chats, and several community meetings,” proposals and feedback.
“Voting in a privacy coin is particularly tricky, since we can’t tie votes to identity,” Yap said, adding, “Without identity, the creation of sock puppets to swing votes was a real risk. We also wanted to avoid creating a plutocracy, and therefore decided against using the amount of coins held as voting power.”
After gathering the most popular proposals on the Discord from the community, Yap said the new allocation was finalized over three community calls spanning disparate time zones.
“There were no major objections to the proposals as a whole, and thus the final allocation was determined,” he stated.