Zcash Faces Governance Dispute as Core Team Departs

The Electric Coin Company (ECC) team, responsible for Zcash development, has departed from Bootstrap, a nonprofit supporting Zcash, due to governance disputes.

• The ECC team described their exit as constructive discharge, citing a breakdown in alignment with the nonprofit's leadership and changes to employment terms.

• The Zcash protocol remains unaffected as it is open-source, but the price of ZEC dropped in response to the uncertainty.

The ECC team behind Zcash has split with Bootstrap, a nonprofit organization created to support the development and governance of the Zcash project.

This split is attributed to a breakdown in alignment and significant changes in working conditions that led the team to resign. The ECC team plans to form a new company to continue the mission of developing private, unstoppable money. Despite this transition, the Zcash protocol will continue to operate as it is open-source and not controlled by any single entity.

The departure of the core development team has raised concerns about the stability and future of the Zcash project. Governance issues between mission-driven development teams and nonprofit structures have been highlighted as a key challenge. These disputes underscore structural flaws in decentralized projects that rely on hybrid governance models. The market has reacted to the news, with ZEC experiencing a price decline following the announcement.

Monero has regained its position as the largest privacy-focused cryptocurrency by market capitalization amid Zcash's turmoil. The governance issues at Zcash have created uncertainty, while Monero has maintained its momentum and outperformed other privacy coins. This shift has accelerated as Zcash navigates near-term uncertainty around its development path. Market participants are monitoring how these changes may affect future protocol upgrades and ecosystem growth for Zcash.

What Is the Impact on Zcash's Future?

The ECC team's departure has introduced uncertainty around the future direction of Zcash. The team emphasized that the Zcash protocol itself is not at risk, but leadership and governance stability are now in question. The formation of a new company to continue the project suggests that the mission of building a private financial system will persist. However, the transition period could affect investor confidence and development timelines for key upgrades.

The governance dispute raises questions about the sustainability of hybrid models that combine nonprofit and for-profit structures. These models often aim to align mission-driven development with community governance, but they can struggle with internal alignment and resource allocation. The ECC team's decision to form a new company highlights the importance of governance flexibility in open-source projects.

How Does This Affect the Privacy Coin Market?

The Zcash split has had ripple effects on the broader privacy coin market. Monero, another leading privacy-focused cryptocurrency, has regained dominance in market capitalization. This trend reflects a renewed interest in projects with more stable governance models. Zcash had previously outperformed other privacy coins in 2025, but the recent turmoil has weakened its position. Investors are closely watching how the ECC team's new company will align with the Zcash community and what this means for long-term development.

The Zcash split also underscores the importance of governance structures in decentralized projects. Projects that rely on a combination of nonprofit organizations and development teams must ensure clear communication and alignment of goals. The ECC team's experience highlights the risks associated with governance misalignment and the potential consequences for project continuity and market performance.

Despite the challenges, Zcash remains a key player in the privacy coin market. The team's commitment to privacy and financial sovereignty is expected to persist, even as the governance model evolves. The next steps for the project will depend on the success of the new company in reestablishing trust and aligning with the broader Zcash community.