Dragonfly’s Haseeb Qureshi Calls for Shutdown of Zcash’s $95 Million Development Fund

Haseeb Qureshi wants it gone. The Dragonfly managing partner has come out publicly urging the Zcash development fund to be shut down once its current term runs out in 2028 — and the debate it’s kicked off is getting messy fast.

The fund isn’t small. Per ZecStats, it holds 63,962 ZEC tokens worth roughly $95 million right now. It keeps growing, too — the protocol feeds it 0.1875 ZEC per block, which amounts to 12% of the block subsidy under the NU6 upgrade. So by 2028, when the current authorization expires, that pile of money could be even bigger. Qureshi’s argument is basically that $95 million — approaching $100 million — is already more than enough for any realistic Zcash development roadmap. His bigger worry, though, is what happens to a fund that size once it starts attracting political attention. He’s pretty blunt about the risk: a fund nearing nine figures gets “politicized,” and once that happens, it’s hard to walk back.

Not everyone’s buying it.

Who Wants to Keep the Fund — and Why

Matt Huang, the Paradigm founder, pushed back hard. His case for keeping the fund alive centers on something a lot of crypto projects haven’t fully reckoned with yet: AI-driven cybersecurity threats and the accelerating pace of quantum computing development. Zcash, with its heavy reliance on zero-knowledge cryptography, is probably more exposed to quantum risk than most chains. Huang seems to think that kind of threat environment is exactly the wrong moment to cut off a dedicated development budget. His position is that the fund isn’t a luxury — it’s a survival tool.

Maxime Desalle, an investment analyst at Winklevoss Capital, landed on the opposite end. He’s not just skeptical of the fund — he wants it gone entirely. His reasoning is that the fund creates the kind of governance bloat and institutional dependency that ends up slowing projects down rather than helping them. He drew a pointed comparison to welfare state dynamics: once a bureaucracy exists to manage a fund, it tends to justify its own existence, and that creates drag. Desalle’s view is that eliminating the fund altogether would cut through those governance disputes before they metastasize.

That’s a pretty radical take, and it’s not where everyone lands.

Zooko Wilcox, the founder of Zcash, came at it from a different angle. He pointed to the Zcash Community Grants Committee as the piece of this puzzle that often gets underweighted in these debates. The committee controls 40% of the development fund’s allocation — a significant chunk — and Wilcox’s position is that it’s been critical to the project’s actual survival, not just its growth. Strip out the committee’s work, and Zcash’s development history looks very different.

See also: Grayscales Zcash ETF to Split 3-for-1 After $233 Million Inflow, Nearing $890 Million

The Governance Fight Nobody Has Solved

Here’s where it gets complicated. Qureshi isn’t just arguing about whether the fund should exist — he’s also taking a position on how it should be governed if it does continue. He’s against pure token holder voting. That model, in his view, is too easy to game and too vulnerable to short-term thinking from holders who may not have the project’s long-term health as their primary concern.

What he’s proposing instead is a hybrid: token holders get to elect temporary councils, and those councils make the actual disbursement decisions. It’s an attempt to keep some democratic legitimacy in the process without handing the keys directly to whoever holds the most ZEC at a given moment.

That structure matters because of how the fund actually works. The NU6 upgrade specs are clear that the fund’s balance sits outside of circulating supply until governance bodies decide to move it. So the money isn’t just sitting in a wallet anyone can access — it requires deliberate governance action to deploy. That’s a meaningful safeguard, but it also means the governance question isn’t academic. Whoever controls the decision-making process controls nearly $100 million.

No final plan has been agreed on. The community is still working through proposals, and there’s no consensus yet on whether to let the fund expire in 2028, extend it, restructure it, or kill it now. Desalle’s more aggressive position — full abolition — hasn’t gained enough traction to look like the likely outcome, but it’s keeping pressure on the more moderate camps to justify why the fund should survive in any form.

Read also: Jaime Leverton Joins Fortitude Mining as Zcash Surges Toward Nasdaq Listing

The Zcash Community Grants Committee’s 40% share of fund allocation keeps coming up as a reference point in these discussions. It’s the part of the governance structure that has the most operational history, and Wilcox’s vocal support for it carries weight. But Qureshi’s concern about politicization doesn’t go away just because the committee has a good track record. A fund approaching $100 million draws a different kind of attention than one worth $20 million did years ago.

Stakeholders are still talking. No vote, no timeline, no deal.