On September 17, Haseeb Qureshi, managing partner at Dragonfly, suggested that the Zcash development fund (Dev Fund) should not be extended beyond its current funding framework, which is set to expire in 2028.

On the $ZEC Dev Fund debate:

The Zcash community has decided its identity is “encrypted Bitcoin.” It has rejected adding more bells and whistles to the protocol. To become encrypted Bitcoin, Zcash must become a dependable store of value, and that means eventually ossifying.

But…

— Haseeb Qureshi ＞|＜ (@hosseeb) September 17, 2026

"The Dev Fund has done a great job and was essential for protecting Zcash’s development at a time when there was no private funding. However, there is a reason why [the fund] shouldn't exist indefinitely," he stated.

Qureshi believes that while the Dev Fund is still necessary to complete technical work, the current funding cycle should be the last. He outlined priorities before finalizing the protocol's foundational rules, which include Tachyon, enhancing quantum resistance, and expanding formal verification.

He cautioned against premature cessation of funding within the next year or two. After key projects are completed, he argued that further ecosystem development should be funded voluntarily by ZEC holders and other participants, similar to Bitcoin's model.

According to ZecStats, as of the time of this writing, the Lockbox held 63,987 ZEC, valued at approximately $95 million. The fund receives a 12% subsidy per block and continues to grow.

Source: ZecStats.

Qureshi warned that further growth of the fund could lead to increased institutionalization and politicization of grant distribution.

Funding Model for Zcash Development

Since the activation of NU6.1, the funding model has included elements from ZIP 1016, which allocates 20% of block rewards to ecosystem development.

Of this, 8% goes to Zcash Community Grants (ZCG), while the remaining 12% is directed to a Coinholder-Controlled Fund established based on the Deferred Dev Fund Lockbox. This scheme is set to last until the third Zcash halving in 2028.

Qureshi also opposed a system where ZEC holders vote directly on fund allocation. He argued that for an asset aiming to serve as a store of value, having predictable rules is crucial. He suggested limited participation from holders through temporarily elected councils.

Previously, Matt Huang, co-founder of Paradigm, expressed support for maintaining the Dev Fund, stating that ongoing funding for public goods is vital for the ecosystem, while also opposing direct voting by ZEC holders.

Conversely, Maxime Desalle, an analyst at Winklevoss Capital, advocated for completely eliminating the structure, arguing it would reduce conflicts over fund distribution.

We can simply completely get rid of ZCG.

Companies and individuals can take the risk up front, ship, and get paid after through retroactive funding.

Solves all the problems with committees, governance over ZCG, etc. https://t.co/xCngJ7IN2B

— Maxime Desalle (@maxdesalle) September 17, 2026

As of the time of writing, ZEC was trading above $1460, reflecting an 8.4% increase over the past 24 hours, with a market capitalization of $24.7 billion.

15-minute chart of ZEC/USDT on Binance. Source: TradingView.

Additionally, on September 16, ZEC holders voted to reduce block time from 75 seconds to 25 seconds while maintaining the current halving schedule.

In January, the entire Electric Coin Company team left due to a conflict with management, later forming the Zcash Open Development Lab.