Electric Coin Company’s Entire Zcash Team Resigns Amid Governance Dispute

The entire team at Electric Coin Company, which develops the privacy-centric cryptocurrency Zcash (ZCASH), has resigned following disagreements over governance with the nonprofit, Bootstrap. The team intends to embark on a new project centered around “unstoppable private money” as ZEC prices take a downturn.

Key Takeaways

Electric Coin Company's whole team resigns due to governance disputes with Bootstrap.
CEO Josh Swihart outlines plans to create a new firm focused on privacy within cryptocurrency.
Bootstrap's proposed changes were described as making it difficult for the team to work effectively.
Zcash's technology remains unchanged amid the organizational shift.
The incident highlights the challenges of governance within decentralized cryptocurrency projects.

Zcash loses Electric Coin Company dev team in governance dispute.

Governance Disputes and Team Resignation

Josh Swihart, the CEO of Electric Coin Company, confirmed the team's exit, declaring their intention to continue developing privacy-centric cryptocurrency. This resignation stems from a perceived breakdown in alignment with Bootstrap, the 501(c)(3) nonprofit created to oversee Electric Coin Company and facilitate Zcash development.

Swihart expressed that many members of the Bootstrap board have drifted away from the core mission of Zcash. In a public statement, he named Zaki Manian, Christina Garman, Alan Fairless, and Michelle Lai as key board members driving this misalignment.

Swihart explained that recent changes introduced by the board altered employment terms for the Electric Coin Company team, ultimately hindering their ability to perform effectively. He described this scenario as constructive discharge, a term referring to conditions so poor that employees resign due to diminished working conditions.

The departing team aims to set up a new organization that focuses on creating what Swihart referred to as “unstoppable private money,” retaining the commitment to privacy and resistance to censorship that Zcash has built its reputation on.

Continuity of Zcash Protocol

Despite these organizational changes, Swihart reassured that the Zcash protocol remains unaffected. He emphasized that Zcash’s codebase is open-source and not controlled by any single entity.

In contrast, Zooko Wilcox, the former CEO of Electric Coin Company and Zcash's founder, defended the Bootstrap board, asserting that Zcash continues to be permissionless, secure, and safe for users. His remarks illustrate differing viewpoints regarding the reasons for and consequences of the team's restructuring.

Following the resignation announcement, the Zcash token experienced a significant price drop, effectively reversing most of its gains from December, according to market analytics.

Implications for the Cryptocurrency Ecosystem

This event underscores the tensions that often arise between mission-driven development teams and nonprofit governance frameworks within the cryptocurrency sector. Zcash has consistently positioned itself as a privacy-centric project, branding itself as a “private money” option for individuals who prioritize transaction confidentiality.

The conflict also highlighted a lack of clarity regarding organizational roles, with Swihart noting that his public designation as the executive director of Bootstrap was outdated.

While supporters of the departing team argue that this split could enhance development efforts, critics worry about potential fragmentation and the loss of continuity in institutional knowledge. This situation showcases the complexities faced by decentralized cryptocurrency initiatives that blend nonprofits, corporate entities, and open-source communities.