- Zcash activated its NU7 mainnet upgrade on Nov. 5, cutting target block times from 75 to 25 seconds.
- The Network Sustainability Mechanism reserves 60% of transaction fees for future block rewards.
- Zcash maintains its 21 million ZEC supply cap and existing halving schedule.
Zcash’s NU7 upgrade is now active on the mainnet. The upgrade makes the target block time go from 75 seconds to 25 seconds. It also introduces a system designed to help the network remain strong over the long term.
The upgrade started at block height 3,543,405 on November 5. This is a step for the privacy-focused cryptocurrency. The upgrade also changes how transaction fees work. It also affects mining rewards. It also touches on legacy shielded transactions.
The NU7 upgrade cuts Zcash’s target block interval by a factor of three so that blocks can appear more often. The NU7 upgrade does not raise the rate at which new ZEC is issued.
Block subsidies have been lowered in proportion. The number of blocks between each halving has been tripled. These changes keep Zcash’s halving schedule and maintain the maximum supply of 21 million ZEC.
The NU7 upgrade aims to improve block production efficiency while keeping Zcash’s long‑term policy the same.
Network Sustainability Mechanism Reserves 60% Of Transaction Fees
NU7 also activates the Network Sustainability Mechanism, or NSM. NSM takes 60% of every block’s transaction fees. Puts them into a public reserve. The remaining 40% goes to miners.
The reserved fees will be gradually returned to the network through block rewards starting at block height 8,939,664. This start is expected to happen in the year 2031.
Big milestone for Shielded Labs: the activation height for NU7 is being set today! The upgrade includes our first major mainnet deployment: the Network Sustainability Mechanism (NSM).
Like Bitcoin, Zcash faces a long-term challenge: how to sustain network security as block rewards decline. The NSM helps address that while preserving the 21 million coin cap.
ZIP-235 removes 60% of transaction fees from circulation, allowing that ZEC to be reissued as future block rewards. ZIP-237 starts that recycling around February 2031.
At current fee levels, that’s only about 210 ZEC per year. This is a modest first step, but we’re optimistic about how new use cases for the NSM could evolve over time and contribute to Zcash’s long-term security.
— Shielded Labs (@ShieldedLabs) October 21, 2026
Shielded Labs, a group that helps develop Zcash, said that NSM addresses the long‑term challenge of maintaining network security as block rewards decline. Shielded Labs believes that NSM will help maintain network security over time.
The organization calls NSM its big mainnet deployment on Zcash. NSM marks a step for Zcash on the main network.
NU7 Makes Remaining Sprout ZEC Unspendable
The upgrade also blocks version 4 transactions, meaning any ZEC still in the Sprout shielded pool becomes unspendable. At the time of activation, about 12,224 ZEC were left in that Sprout shielded pool. Node operators had to upgrade their software to remain on the network’s consensus chain, while most wallets did not require changes.
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