ZKsync Creator Pitches Governance Token Redesign

The co-creator of the Ethereum-scaling solution ZKsync has proposed a major overhaul of its governance token, arguing that it should prioritize “economic utility.”

In a place on Tuesday at the ZKsync forum, Alex Gluchowski argued that while his ZKsync (ZK) the governance token was effective in the early stages of the project since “the path of architecture and adoption was still in shape”, the network has since. evolve rapidly.

He said he now hosts a interconnected ecosystem zero knowledge chains, and it is important that the ZKsync token captures the value of the network and drives the adoption of the ecosystem.

“The goal is to align use with value, make decentralization economically sustainable, and ensure that the network captures a significant share of the economic benefits it creates.”

Gluchowski, who is also the co-founder and CEO of Matter Labsthe company behind ZKsync, emphasized that the funds should go back into the “network economy”, since this will allow the continuous upgrading of the infrastructure, security improvements, financing of public goods and “long-term independence”.

“The design goal is to establish a self-reinforcing economic cycle where adoption increases the resources of the network, and those resources in turn strengthen the network for all participants,” he wrote.

New revenue-related tokenomics

Gluchowski outlined that the renewed ZK token would derive value on-chain from routes such as native protocol fees, generated by “interoperability and other core settlement and messaging functions”, and offchain via licensing agreements for “enterprise software components”.

Related: Crypto investors flee visibility for anonymity as privacy coins rise 80%

Regarding licensing, the ZKsync stack is free to use, as it is open-source. However, Gluchowski argued that when large companies adopt “community-built infrastructure” for complex uses, such as treasury integrations, there must be agreements to return value to the ecosystem.

“When such capabilities are financed by the ecosystem, it is reasonable that their use by business participants brings value to the ecosystem,” he wrote.

From there, all this extracted value then flows into a “governance controlled system” that would direct it to ZK market purchases, staking rewards, token burning and ecosystem funding.

“For decentralization to persist, it must be economically sustainable. The network needs a durable economic model that supports development, security and ongoing operation by many independent participants, not by a central sponsor.”

ZKsync has been considering a change to its governance token for months. In June, Omar Azhar, the head of business development at Matter Labs, published a “ZKnomics Roadmap Vision” on the project forum.