Zcash Developers Resign Over Governance Disputes, Form New Startup

• Zcash’s core development team resigned en masse following disputes with Bootstrap, the nonprofit governing the Electric Coin Company (ECC), citing intolerable working conditions and misalignment with the project’s privacy mission.
• The team has regrouped under a new for-profit entity, cashZ, to continue Zcash development independently. This shift aims to reduce governance friction and enable faster, more agile development aligned with Zcash’s long-term goals.
• The Zcash network remains fully operational with no technical disruptions. The transition has raised questions about long-term coordination and funding within the ecosystem but does not affect the protocol's security or open-source nature.

The resignation of Zcash’s core developers highlights the fragility of centralized governance structures in privacy-focused projects. Josh Swihart, the former CEO of ECC, described the situation as a "constructive discharge", citing governance changes that altered the team’s employment terms and undermined their ability to advance Zcash’s mission.

The Bootstrap board, which includes Zaki Manian, Christina Garman, Alan Fairless, and Michelle Lai, faced criticism for diverging from Zcash’s original vision of privacy-centric development. The ECC team accused the board of prioritizing institutional partnerships over user privacy, leading to the decision to form a new independent company.

What Drives Concerns Over Zcash’s Governance Model?

Zcash’s governance model has long been criticized for its reliance on a single development team. The recent exodus underscores the risks associated with centralized governance structures, particularly in a sector that values decentralization and autonomy.

The formation of cashZ is seen by some as a positive step toward reducing governance risk and enhancing development agility. The new company aims to scale Zcash to billions of users by operating independently of nonprofit governance constraints.

However, the transition has also raised concerns about long-term coordination and funding. The ECC team’s departure has left the Zcash ecosystem with unresolved funding issues and uncertainty about the future of core development.

How Does This Affect Zcash Holders and the Market?

The Zcash token (ZEC) experienced a sharp sell-off in the immediate aftermath of the resignation announcement, with prices dropping roughly 10–20%.

The market’s reaction reflects broader concerns about governance instability in the privacy coin sector. While Zcash remains technically functional and decentralized, the exodus has raised questions about the project’s ability to maintain its long-term vision.

Retail traders and long-term holders are now facing increased uncertainty. The price decline has affected short-term positions, while long-term holders grapple with doubts about Zcash’s future direction.

Institutional investors, including those with exposure to ZEC, are also impacted by valuation risks. The broader crypto market is closely watching how Zcash navigates these challenges and whether it can maintain its relevance in the evolving privacy coin landscape.