Zcash Quarterly Report: Wages Decline as Currency Price Falls
The Electronic Coin Company (ECC), the foundation partly responsible for the development of the Zcash privacy-centric cryptocurrency, published in its quarterly transparency report on August 30 that while salaries remained high in the first quarter of this year, things have worsened as the price of the currency has dropped.
Zcash's selling point is that it allows users to hide how much money they are sending over the network. The ECC is a for-profit company run by Zooko Wilcox, and the Zcash Foundation, a nonprofit aid the development.
Although the price of Zcash (ZEC) has dropped 66% against Bitcoin since the beginning of the year, "at the first-quarter price of approximately USD 55 per ZEC, the company, and its employees received salaries totaling approximately USD 449,000 per month," the report reads. Coins worth an additional USD 110,000 were also distributed to employees.
That is much less than what ECC reported in its second-quarter transparency report, published in May, which pointed out that, at a price of around USD 60 per ZEC, employees received USD 550,000 per month and an additional USD 180,000 for employee compensation, as the coins were distributed to employees each month.
If the trend continues, wages will be even lower in the next quarter. The May report estimated that Zcash's price would reach USD 60, but prices fell to USD 55 on the report's release date (Friday). At the time of writing, however, Zcash's price continued to fall to just USD 44, which represents lower wages.
However, the fall in salaries is not only due to the decrease in the price of currency: the percentage of funds allocated to employees' salaries also decreased. In the second half of last year, 62% of the funds were spent in the form of employee compensation. In the first quarter of this year, it was only 56%.
Comparatively, the proportion of funds spent on consulting and marketing has increased. Consulting expenses increased from 6% in the second half of 2018 to 10% in the first quarter of 2019, and marketing and public relations grew from 9% (then called "Awareness and Education") to 14% respectively.
ECC's overall operating costs have fallen in the first quarter of this year in response to "continued market pressure. The second-quarter report says that operating costs averaged a total of USD 700,000 per month, now reduced to only USD 525,000.
The amount the company reported having in USD and Zcash is more or less the same: USD 5.2 million in August and USD 5 million in May. However, that has already fallen. At Zcash's annual conference at the end of June, Wilcox revealed that Zcash only had US$3.35 million in the bank.
About The Author
Juan AponteI am an industrial engineer specializing in blockchain. Enthusiast of cryptocurrencies and writing the latest news regarding the Crypto world.
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