Privacy needs
an exit option.

Frank Braun’s July 2025 thesis argues that Zcash could benefit if demand for financial privacy grows.

He connects private wealth storage and commerce to demand for privacy coins, arguing that longer-term shielded holdings and better wallet usability could reinforce adoption. His investment case also considers issuance, competition, and execution risk. [1]

Zclassic is nearly as old as Zcash. Its published launch date is just nine days later.

Zcash’s v1.0.0 release, dated October 28, 2016, included its mainnet genesis block. Zclassic dates its Equihash PoW mining history to November 6, 2016. ZCL is the native coin of its own privacy blockchain, with its own miners, consensus rules, and a public history of blocks and transactions. [12] [2]

The Lindy effect

The Lindy effect is the idea that, for some enduring technologies and ideas, surviving longer can point to a longer expected remaining life. Time gives us a history to examine. Taleb’s explanation ↗

That is part of ZCL’s appeal to me: a privacy chain with proof-of-work history stretching back to 2016. Its age is part of its charm and a reason to revisit an overlooked L1. Applying the Lindy effect here is my thesis, not a measured forecast of the chain’s remaining life. Hashpower, security, adoption and future returns still need their own evidence.

I like Zcash. I find ZCL’s reward structure fairer.

I value the privacy research and engineering behind Zcash. My fairness argument is narrower and explicit: I prefer a network where the block reward goes to the miners doing the work, without a protocol-enforced founders’ or development allocation. Zclassic’s stated model fits that principle. This is my judgment about the rules, not a claim that every ZCL holder has equal wealth or that development costs disappear. [2]

I want competition to push protocol-funded rewards toward the minimum needed to deliver work users actually value.

A development organization should have to justify its cost, just as any other service provider does. When funding is embedded in consensus, a dissatisfied holder cannot simply cancel that allocation while continuing to use the same rules. Their alternatives are to persuade the network to change the rules, accept the arrangement, or leave.

A credible ZCL alternative could make leaving a meaningful choice. If users, capital, miners, and builders prefer a network without the same development allocation, that gives Zcash’s funding recipients a reason to ask for less, explain their budgets, and demonstrate why their work is worth supporting. The pressure would be strongest if useful work can be sustained with smaller allocations or voluntary funding.

This is what I mean by competing the reward down: make the cost of institutional funding visible and contestable. Buying ZCL does not mechanically lower a Zcash funding percentage. It supports the outside option that could make a lower percentage politically and economically attractive.

Zclassic describes its block rewards as going entirely to miners. That makes it a useful point of comparison, but it does not establish equal security, privacy features, or maintenance quality. A cheaper alternative must still work. [2]

An organization expecting recurring funding can feel pressure to produce a continuing roadmap.

My concern is an incentive mismatch. A funded organization must explain its budget, retain staff, and demonstrate progress. New protocol features produce visible milestones. Keeping a sound monetary rule unchanged produces fewer announcements, even when that restraint is more valuable to holders.

This concern applies under either PoW or PoS; it does not establish that funding causes a move to staking. Zcash’s specified development-fund periods have end dates, even if recipients may seek renewal. [5]

That can create a cycle: a budget supports a team; the team needs a roadmap; the roadmap proposes protocol changes; those changes create new implementation, audit, and maintenance work that supports the next budget. Nobody has to act dishonestly for this incentive to exist. This is my institutional critique, not evidence of any particular person’s motive.

For monetary rules, my starting point is continuity. Every change should overcome the costs of implementation risk, coordination, and weakening expectations that the rules will stay put. When the claimed improvement cannot clear that bar, leaving the protocol alone is the better outcome.

Doing nothing to issuance does not mean abandoning the software. Fix vulnerabilities, maintain nodes, improve wallets, and fund careful audits. Judge that work by user benefit and reliability, rather than the number of consensus changes shipped.

For issuance smoothing, my preference is to leave the established monetary schedule alone.

This is a third question: when coins are issued. It is distinct from who receives them and from how consensus works. Issuance smoothing does not, by itself, introduce PoS or determine a development-fund percentage.

ZIP 234 is marked Draft in the text reviewed September 12, 2026. It proposes replacing stepped halvings with a subsidy calculated from the remaining money reserve, retaining the stated 21-million cap. It also enables future reissuance of funds deliberately removed from circulation through the NSM. Its authors argue this could soften mining-revenue shocks and support long-term security. [6]

Those are the benefits the proposal needs to establish. My objection is that the cap is only one part of a monetary commitment: the timing and conditions of issuance matter too. A familiar schedule gives holders and miners a rule they can plan around. Changing it spends some of that predictability and sets another precedent for revisiting monetary policy.

A smoother revenue path may appeal to miners and, wherever funding streams receive a share of the subsidy, to those recipients as well. That creates a reason to examine incentives; it does not prove that smoothing increases an organization’s total funding or that its authors proposed it for personal benefit.

In my assessment, retaining the existing schedule is better unless proponents show that the security benefit outweighs the implementation and credibility costs. An institution needing a new project is not a reason to change the money. A credible PoW alternative can reinforce that boundary by giving people who value restraint somewhere else to go.

A passive holder, a holder earning staking rewards, and a business charging staking fees do not have identical interests.

My concern is that recipients of new issuance can support more of it when they expect their rewards to outweigh dilution of their existing balance. A passive holder receives no such offset. Where coin voting exists, that difference can influence votes; where governance is informal, it can influence advocacy and which upgrades people support. Ownership creates an incentive to protect a coin’s value, but it does not eliminate the incentive to seek a larger share of its rewards.

That is a possible incentive, not a prediction that every holder or staker will favor inflation. Higher issuance can attract more competing stake, dilute existing coins, increase costs, or undermine the price. Miners can lobby for larger subsidies too. PoW does not remove the need for users to defend monetary rules.

Ethereum researchers Ansgar Dietrichs and Caspar Schwarz-Schilling make a related distinction in their February 2024 staking-economics analysis: holders and stakers bear dilution, while service providers earn fees from operating staked positions. They also warn that a higher nominal yield need not produce a higher dilution-adjusted return. Their proposal is analysis, not a claim about adopted policy. [17]

Ethereum and the “ultrasound money” narrative

The appeal was understandable: burn transaction fees, reduce issuance, and ETH supply could shrink. EIP-1559 introduced base-fee burning; the September 2022 Merge then removed PoW issuance and sharply reduced total new issuance. That reduction was real. It did not guarantee permanently falling supply. [18] [19]

Dencun, activated March 13, 2024, introduced a cheaper, separate blob fee market for rollup data. Blob fees are also burned; burning was not abolished. Lower fees can nevertheless mean less ETH destroyed. In its May 29, 2025 report, Glassnode and CME documented ETH’s return to net inflation following Dencun and reduced network fees. This is a dated historical observation, not a live supply reading. [20] [21] [22]

I think it is a mistake to treat the “ultrasound money” narrative as a durable monetary promise: its deflation depends on demand. Cheaper transactions can be useful while weakening the burn that supported the scarcity story. People evaluating the asset should examine that tradeoff instead of assuming the slogan settles it.

This history does not show that ETH holders voted to raise validator issuance: Ethereum has no such simple protocol ballot, and the Merge moved gross issuance sharply downward. It shows how supply can grow again when burning falls. The separate incentive question remains: who receives issuance, who bears dilution, and who has influence when the rules are reconsidered? [16]

For ZCL, my preference is an established PoW alternative whose issuance rules can be inspected directly, with monetary changes required to earn support. ZCL still issues mining rewards; PoW is not a promise of zero inflation. My argument is for predictable rules and a credible option to leave when the beneficiaries of a proposed change cannot make their case.

ZCL can evaluate compatible Zcash research and code while keeping its own consensus rules. Adopting a privacy improvement does not require adopting Crosslink’s proposed stake-based finality. The choice of development funding remains separate from both.

Zclassic already descends from Zcash’s code and privacy technology. Open-source development creates reusable work: applicable security fixes, cryptographic research, wallet improvements, and performance improvements can be evaluated for ZCL. Reusing compatible work does not require importing a founder reward or giving stake-based finalizers authority over the chain. Zclassic’s codebase ↗ · Upstream licensing ↗

In economic terms, this is a free-rider advantage: Zcash’s ecosystem can fund research whose benefits extend beyond ZEC. A smaller chain may adopt useful results while competing on a lower mandatory allocation from block rewards. I see that as another reason development funding should face competitive pressure. It does not mean the original research was free, or that the people funding and building it deserve no credit.

The savings are conditional. ZCL still needs maintainers to review licenses and dependencies, port compatible changes, audit the result, and test network upgrades. A feature tied to new transaction rules or consensus may need substantial redesign; ZCL does not automatically inherit every Zcash upgrade or its security assurances. As the projects diverge, that work can become harder.

Crosslink has a stronger case when the goal is better settlement assurance while keeping PoW mining.

The proposal adds stake-weighted finalizers alongside the existing PoW chain. Miners still produce blocks. Under the protocol’s security assumptions, finalized history gains protection against reorganizations. For an exchange crediting deposits or a merchant accepting payment, that could make settlement more dependable and reduce the need for long confirmation waits. Crosslink is a hybrid design, not itself a replacement of mining with full PoS. [8]

A more concrete benefit than changing the issuance curve

The distinction I find persuasive is between changing who can reverse settled history and changing when coins enter circulation. Crosslink targets the first problem; issuance smoothing targets the second. They are not interchangeable solutions. If rollback risk is the problem users actually face, stronger finality addresses it more directly than a different issuance schedule. That is a reason to evaluate Crosslink on its own merits, not to accept an entire upgrade bundle.

Pay for security with the existing subsidy

The April 2026 feature-net announcement models rewards as 40% for miners, 40% for stakers, and 20% for a development fund. This illustrates funding another security role by reallocating the subsidy. It is a proposed/test-network allocation, not a live-mainnet claim. [9]

The economic argument is that a given subsidy might buy better protection when it supports complementary mining and finalization roles. That benefit has to exceed the effect of reducing miners’ share. The 40% staking allocation pays for the proposed finalization role; the 20% development allocation pays designated development recipients. These are different purposes, even though both share the same subsidy. Changing either percentage does not determine the other. Crosslink does not by itself compete down development funding.

Two different concessions to assess

Adding stake-based finalizers changes the authority over finality. Reducing miners’ subsidy share changes their compensation. A funding allocation can reduce miner revenue while leaving the PoW consensus model intact; a finality change can alter consensus even if the development allocation stays fixed. I should not treat those as the same loss of influence.

My concern about precedent applies separately to each: once a particular principle is relaxed, a further change along that same dimension may be easier to justify. For Crosslink, I want a case for its finality authority and a case for its security-budget split. Neither concern proves that further concessions are inevitable or that miners possess a unilateral veto.

Test whether finality keeps working

Nicolás Della Penna’s January 2026 mechanism-design audit found strong safety once finality is reached, conditional on BFT assumptions and PoW consistency. It also identified fragile liveness incentives and potential coordinated stalls in the reviewed baseline. Its findings concern a specific evolving design, not a blanket verdict on later versions. [10]

Shielded Labs’ May 2026 feature-net report describes finality stalls while PoW blocks continued, with recovery still under investigation. That is useful testing evidence, but it prevents me from treating dependable recovery as already established. [11]

Owning ZCL does not give me a veto over Zcash.

Zcash changes go through a proposal process and network adoption. The Foundation is an influential participant, not a unilateral switch for consensus rules. [3]

ECC’s published PoS research establishes that a transition has been explored. It does not establish that the Foundation can impose one, or that a particular proposal has activated. Crosslink’s proposed hybrid approach makes this design distinction concrete: miners continue producing blocks, while stake-weighted finalizers add settlement protection under the protocol’s assumptions. [4]

My concern is that tying consensus participation to stake can increase the importance of existing capital holders. That concern must be tested against the actual design. PoW has its own concentration and security tradeoffs.

Ready to explore a ZCL position?

Visit NonKYC.io to check ZCL markets, current liquidity, and trading fees.