ZCash (ZEC) promised to be cryptographically protected, anonymous magic internet money. The coin arrived to the party relatively late, with a high-profile launch in 2016. Immediately, the hype and the bull market took ZCL prices to the equivalent of nearly $6,000, with the claims of displacing Bitcoin (BTC).
But ZEC quickly saw trouble. Here are the five biggest problems for the ZCash project:
Founders’ reward: The biggest contentious issue was the fact that the developer team instituted a founders’ reward, which went on to support early investors, developers, and the Electric Coin Company, an entity aiming at popularizing ZCash and related projects.
The reward took a cut of each block reward, for a period of four years since the start of mining. In the end, Zooko Wilcox, the project’s co-founder, and the team plus investors, would end up holding about 10% of the entire coin supply. But what angered investors more was the personal reward of Wilcox, which is 2,033 ZEC, worth as much as $300,000 per month at one point.