Zcash drops under $400 as core developers walk away

The team at Electric Coin Company (ECC), an organization responsible for the development and maintenance of the Zcash protocol, has resigned en masse following a board dispute stemming from irreconcilable governance conflicts. 

According to a post from Josh Swihart, CEO of the Electric Coin Company (ECC), for the past couple of weeks, the majority of Bootstrap board members, a 501(c)(3) nonprofit created to support Zcash by governing the Electric Coin Company, specifically Zaki Manian, Christina Garman, Alan Fairless, and Michelle Lai (ZCAM), are no longer aligned with the mission of Zcash.

When did the Zcash team exit the project?

Swihart revealed that on January 7, the whole ECC team left. He described the exit as a “constructive discharge” by ZCAM.

“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 wrote before declaring plans to found a new company.

Of course, he quickly reassured readers that the founding company will have the same team and that the mission to build “unstoppable private money” remains unchanged.

According to him, the Zcash protocol was not affected by this development, and the decision was made to protect the team’s work from malicious governance actions that have made it impossible to stay true to ECC’s original mission.

He ended the post by implying there is an investigation going on and that there would be more updates soon. Until then, he urged community members to “hang tight.”

Why did the Zcash team leave?

In response to the announcement of the “constructive discharge,” community members piled into the comments section demanding to know more about what caused the discharge.

An old screenshot of a conversation between someone and one of those Swihart named in his post, Zaki Manian, who goes by “zmanian” on X, and runs the Bootstrap Foundation, which owns the ECC that ousted the core team, has surfaced, calling into question his credibility as a team player.

In the conversation, Zaki boasted about his history of “burning down billion dollar blockchains” while the other person, later identified as the community manager of a project in the Cosmos ecosystem, seemed to be trying to convince him to find a better way to address an issue.

The person who posted it had been warning projects that were linked to Zaki in any way to distance themselves from him because of how toxic he seemed to be.

That was in December 2024, but the screenshot is now making the rounds on X, further damaging Zaki’s credibility as more people wondered how many other projects he is linked to in the Cosmos ecosystem that could suddenly “burn down.”

What will happen to Zcash now?

Despite Swihart’s reassurances, the bottom appears to have fallen out for ZEC. At the time of writing, it is now trading at $397.43 with a market cap of $6.54 billion.

Observers predict more dumps could follow as traders and long-term holders price in increased “governance risk,” a premium for the uncertainty surrounding the project’s leadership and its future.

The updates that Swihart promised will need to come soon to reassure panicked holders despite the vacuum left behind by the core team’s exit.

If you're reading this, you’re already ahead. Stay there with our newsletter.