Zcash activates NU7 upgrade, reducing block times and freezing legacy funds

The Zcash network has officially activated its NU7 network upgrade at block 3,543,405. A primary feature of the upgrade is the reduction of target block times from 75 seconds to 25 seconds, which aims to accelerate transaction confirmations for users.

To maintain the existing 21 million ZEC supply cap and halving schedule despite faster block production, the network has proportionally adjusted block rewards. The upgrade also introduces the Network Sustainability Mechanism (NSM), developed by Shielded Labs. This mechanism redirects 60% of transaction fees away from circulation to be reissued as block rewards starting around 2031, addressing long-term security concerns as block subsidies decline.

A significant side effect of the upgrade is the invalidation of version 4 transactions. This change has effectively frozen approximately 12,224 ZEC, valued at roughly $15 million to $16 million, within the legacy Sprout shielded pool. While these funds are not burned, they are currently unspendable under the new consensus rules. Zcash co-founder Sean Bowe previously characterized the Sprout pool as technical debt and a security risk, though the possibility of future access via subsequent upgrades remains a topic of discussion.