Zcash core team quits over restructuring conflict, ZEC down 20%
Zcash’s entire Electric Coin Company (ECC) team has resigned to start a new privacy crypto firm after claiming that internal conflict over restructuring meant they could no longer honour the firm’s original mission.
Former ECC CEO, Josh Swihart, announced the group’s departure from the cryptocurrency’s main development group on Wednesday.
Swihart claims that the developers were “constructively discharged” by board members of nonprofit Bootstrap, a group that owns ECC and backs Zcash.
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He said, “In short, the terms of our employment were changed in ways that made it impossible for us to perform our duties effectively and with integrity.”
He noted that the privacy protocol is unaffected, adding that the team’s departure is “about protecting our team’s work from malicious governance actions that have made it impossible to honor ECC’s original mission.”
Bootstrap board says resignation is over restructuring
Swiharts says Bootstrap board members were misaligned with Zcash’s mission. Board member Zaki Manian, however, has since released a statement on behalf of Bootstrap denying this.
The board claims the dispute was over how the company would be restructured as it sought external investment and attempted to privatise the Zcash wallet Zashi.
The board says it has been cautious to abide by U.S. nonprofit law, remain consistent with the long-term mission of Zcash, and not jeopardize the broader Zcash community.
However, it claims that a proposed deal, seemingly backed by the now departed developers, would open Zcash up to politically-motivated attacks, lawsuits from donors, and the “transaction” unwinding, resulting in Zashi transferring back to the ECC.
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“We do not doubt that those who proposed this transaction believed it was the right path forward for Zcash,” it said, “but good intentions do not satisfy legal requirements, and urgency does not excuse a flawed process.”
The board also claimed, “This is not a disagreement about Zcash’s mission, which remains unchanged. It is about compliance with the legal and fiduciary obligations of a 501(c)(3), and about the moral imperative of ensuring Bootstrap’s assets remain dedicated to the mission they were meant to serve.”
Swihart became CEO of ECC back in 2023 after another founding member of Zcash, Zooko Wilcox-O’Hearn, stepped down from the firm.
At the time, Wilcox-O’Hearn hinted that a disagreement had taken place between himself and Swihart.
In response to the recent resignation, Wilcox-O’Hearn distanced himself from the conflict and said, “None of it involves me or Shielded Labs, and it’s not my place to opine on it.”
He also described the alleged misaligned board members as “people of exceptionally high integrity,” and noted that nothing in the conflict will stop Zcash from being “open source, permissionless, secure, and private.”
At the time of writing, Zcash is down almost 20% across the last 24 hours.
Protos has reached out to Zcash for comment and will update this piece should we hear back.
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