Zcash NU7 shortens block targets and changes long-term mining incentives

Zcash’s NU7 upgrade introduces a faster block target and a new approach to funding security as ordinary mining subsidies decline. Activation was set at mainnet block 3,543,405, reached on November 6, with the block-time target falling from 75 seconds to 25 seconds.

Alongside that faster cadence, the package removes a portion of transaction fees from circulation for future algorithmic reissuance. It also ends support for version 4 transactions, closing the remaining route for spending funds held in Zcash’s oldest shielded pool, Sprout.

Faster blocks do not expand the supply cap

The deployment specification groups several changes into NU7. Shorter target spacing increases the expected frequency of blocks, but the accompanying subsidy adjustments preserve the intended issuance schedule rather than simply multiplying coin creation.

The network’s long-term upper limit remains 21 million ZEC. That boundary matters because faster confirmations and a different distribution of rewards are operational changes; they do not create authorization for unlimited new supply.

Node operators also face a practical upgrade requirement. The deployment specification warns that unsupported software can remain online while following the older consensus branch. Staying connected therefore does not, by itself, show that a node is validating the upgraded network.

Fees become part of a future security budget

ZIP 235 directs 60% of transaction fees out of current circulation, leaving the remaining share available to miners. The removed value is intended for later reissuance under the Network Sustainability Mechanism, rather than permanent destruction or discretionary spending by a treasury manager.

ZIP 237 retains the scheduled halving structure and adds a formula for reintroducing eligible value through future block subsidies. The mechanism is designed to support mining incentives as the original subsidy diminishes, while keeping total issuance below the established cap.

That design changes when value becomes available, not whether someone can freely spend a central reserve. Its eventual contribution to security will depend on the value accumulated and the network’s future activity. The specifications describe rules and objectives, rather than a guarantee about miner profitability or ZEC’s price.

Sprout holders lose their spending route

Version 4 transactions are the only format capable of representing Sprout transfers. Because NU7 rejects that version, remaining Sprout balances cannot be spent under the upgraded rules. The activation coverage estimated that roughly 12,224 ZEC remained in the pool.

ZIP 2003 explicitly distinguishes this restriction from formally burning or removing those coins from issued supply. A future consensus change could theoretically restore a route, but no such recovery is guaranteed and spending may never be re-enabled. The immediate consequence for those balances is an access restriction, alongside a reduction in the obsolete transaction machinery that nodes must continue supporting.