- Zcash briefly fell by 20% as its core team, ECC, split from its governance structure.
- ZEC eventually recovered intraday after former ECC CEO Swilhart assured the crypto community of his group’s continued commitment to Zcash.
- The former ECC team prepares to launch cashZ to help Zcash scale to billions of users.
Zcash (ZEC) plummeted on Thursday evening following the mass resignation of its core development team, Electric Coin Company (ECC), amid governance disputes. The privacy-focused crypto fell by over 20%, from $481 in the wee hours of Thursday (UTC) to $382 by noon of the same day, in the event’s aftermath.
Former Zcash Dev Team has No Plans for a New Token Launch
Josh Swilhart, former CEO of ECC, immediately confirmed the news on X, sending ZEC’s price packing. This further amplified the crypto asset’s sell-off as the market braced for massive profit-taking stemming from Bitcoin’s (BTC) overheated sentiment. The premier digital asset notably peaked above $94,000 this week before correcting to the $89,000 range.
However, Swilhart clarified that his team remains “all in on Zcash” to quell the controversy around the move. This comes as assurance to Zcash holders, as some members of the crypto community have begun stirring up the pot over speculation that ECC may be launching a new token.
The Issue Within Zcash Governance
According to a blog post linked to Swilhart’s announcement, ECC’s mass exodus stemmed from disputes with Bootstrap, the nonprofit foundation overseeing the company. The former CEO claimed that the former governance structure made it hard for ECC to continue operating.
Swilhart highlighted that Zcash needs to scale to billions of users to sustain its growth. Hence, his group decided to launch a new Zcash wallet, codenamed “cashZ,” to support his vision. The new wallet is open to Zashi users, but they must sign up for the waitlist to be part of the migration.
“Startups can scale, but nonprofits can’t,” said Swilhart on X after the split. “That’s why we created a new Zcash startup.”
Swilhart addressing the issue and unveiling of the cashZ initiative helped Zcash immediately recover by 14%, from $382 to approximately $436 by Thursday evening.
Zcash’s Aggressive Scaling Underway
Swilhart criticized how Zcash, despite its huge potential and being like Bitcoin with better privacy features, has remained “a small cap coin” compared to the likes of BTC, Ethereum (ETH), and other industry heavyweights. He pointed out that ZEC has always shown “it’s important in theory, but not in practice.”
ZEC’s small-cap status led many institutions to overlook its potential until it began gaining traction in recent years. Swilhart and his team wanted to capitalize on that attention to further build Zcash up and scale it to billions of users. He emphasized, though, that it’s only possible to achieve such a goal if the organization supporting it is “built to scale.”
“That’s the third reason why we needed a new governance structure: because Zcash must become so big they can’t stop us, and we must scale to succeed,” Swilhart stated.
