Electric Coin Company (ECC), one of the key developer teams behind the Zcash network, has called it quits over a governance dispute with Bootstrap, a nonprofit that governs it.
According to ECC CEO Josh Swihart, the nonprofit moved into a “clear misalignment” with Zcash’s mission. Swihart added that the Bootstrap board made it impossible to work “effectively and with integrity.”
He said that they’ll form a new company with the same team, reiterating that the Zcash protocol remains unaffected.
“The Zcash protocol is unaffected. This decision is simply about protecting our team’s work from malicious governance actions that have made it impossible to honor ECC’s original mission.”
All about Bootstrap’s position
In response, the Bootstrap board defended itself, stating that the disagreement is instead due to compliance issues. The contentious plan reportedly involves the privatization of the Zcash-based Zashi wallet via alternative structures.
As a nonprofit organization, the board believes the plan to privatize Zashi could attract lawsuits from its donors. Bootstrap also believes that the legal limitations can’t be overlooked, despite the proposed Zashi plan being apt.
“Their (ECC) commitment to the project is real, and their frustration with the constraints of nonprofit governance is understandable. But good intentions do not satisfy legal requirements, and urgency does not excuse a flawed process.”
According to the board, its stance is not a disagreement with the Zcash mission, adding that a hurried restructuring would dent the protocol’s trust.
“A restructuring done in a way that invites scrutiny, even if well-intentioned, would damage that credibility and set back the cause of privacy and financial freedom.”
Here, it’s worth pointing out that a few hours later, former ECC CEO Josh Swihart announced CashZ – A new Zcash wallet to scale the protocol to mass adoption.
For his part, Dragonfly Managing Partner Hasseb Qureshi billed the Swihart-led team as “true believers” and an overall bullish rating for ZEC coin. He said,
“Say what you will about them, the Zcash team are true believers and cypherpunks. When a project is driven by conviction, it survives where others would wither.”
ZEC sees mixed results
Initially, the ZEC coin dumped by 22% from $490 to a low of $381 as the market wrongfully interpreted the update as core developers abandoning the protocol entirely.
However, it was just an organizational change. In fact, at press time, ZEC had rallied by 10% to a high of $438 after the team unveiled a new wallet and reinforced long-term conviction.
Meanwhile, the number of traders bullish on ZEC jumped to 61% on Binance at the time of writing, underscoring renewed positive sentiment.
Final Thoughts
- Electric Coin Company CEO blamed Bootstrap nonprofit for “clear misalignment” with the Zcash mission.
- However, the nonprofit maintains that the ECC disagreement is only based on legal and compliance issues.
