LayerZero is here…
Well, following zkSync, LayerZero has arrived, which many of us have been waiting for just as much as the recent disappointment with zkSync.
If you missed the drop, hurry here: CLICK
You can claim in the networks Arbitrum, Avalanche, Base, BSC, Ethereum, Polygon, and Optimism. And yes, the $ZRO token is already listed on Binance, ByBit, OKX, and other exchanges, trading at around $3 per token! You could sell for around $5.
Although I am sure there is no need to go into the details of the distribution, because LayerZero has been much more transparent in this regard than zkSync, and we could observe all the team’s actions live, it is still necessary to look at the whole picture!
Let’s start with the main thing… Tokenomics!
The total supply of $ZRO tokens is 1,000,000,000, distributed as follows:
- 8.5% — Goes to the drop we received today: 5.5% for using LayerZero directly and 3% for protocols built on LayerZero.
- 15.3% — Reserved for future drops and events among users, protocols, and builders (There will be other snapshots and RFPs). Currently, 11.5% of the $ZRO supply is available at TGE from this category, but they are essentially not liquid (at least they shouldn’t be), with the first use directed towards a community program in Discord allocating 5,000,000 $ZRO tokens (More on this later).
- 32.2% — Investors and advisors. They have a one-year cliff and subsequent vesting over two years.
- 25.5% — The LayerZero team, including current and future employees. They also have a one-year cliff and subsequent vesting over two years.
- 4% — Purchased $ZRO tokens. These tokens were bought by LayerZero Labs and given to the community.
In the end, at TGE, we get 25% unlocked tokens, but according to the team, as I emphasized above, this does not mean that all of them are in the market. A significant portion of tokens is unlocked for future use!
Now about the Eligible selection process!
No need for many words here, as, like I said, we saw it all live.
In the first stage, Sybils had 14 days to stake themselves. For this, they could receive 15% of their drop. Then Chaos Labs and Nansen published the first Sybil list, where Sybils could appeal.
Then the second stage started, where Sybils could stake other Sybils for 10% of their drop. After this campaign, Chaos Labs and Nansen continued forming the lists.
In the end, according to LayerZero Foundation, they managed to save 1% of the total supply (Not much!).
Now let’s move directly to the drop process itself. As mentioned earlier, 8.5% of the supply was allocated for the drop, with 5.5% going to the drop for direct use of LayerZero, and the remaining 3% distributed by the ecosystem protocols themselves, known as the RFP drop.
Main Drop 5.5%
This is very simple. All users who made transactions before the snapshot are eligible for a minimum amount of 25 $ZRO and a maximum of 5,000 $ZRO.
In this drop, transactions worth less than $1 and useless NFT transactions (very low market value) were reduced by 80%. Essentially, 5 useless transactions equaled one normal transaction.
Additionally, early users and those who interacted with LayerZero after the first snapshot received additional tokens.
RFP Drop 3%
Here, protocols built on L0 submitted their applications for token distribution (230 proposals were submitted, 211 approved).
Within the RFP, users could receive a minimum of 5 $ZRO tokens and a maximum of 10,000 $ZRO tokens.
Distribution to developers was done in a 90/10 proportion, with a maximum of 100,000 $ZRO per team. Many’s favorite Merkly already dumped his entire drop in one transaction!
Now to the point
The community of Sybils has grown so much that this system is starting to kill itself. I am talking about competition. If previously there was enough space for everyone in projects, now those times are gone.
I have been following the poker player from the start, as have many of us.
And here’s what I highlighted for myself.
The poker player played fairly and openly. You were told there would be a drop, no sale. You were told the token would come out at the end of H1, and it did. Moreover, the entire process of cutting was closely watched by the Sybils.
Many were made nervous by the Sybil hunting program, but objectively, we were given a clear take that any influencer could stake their reputation for 10%, that our crypto community has long gone beyond cozy chats, and there will be many rats — it’s competition!
The only thing, in his final vision of the drop, he planned to distribute to about 600,000 addresses, but in the end, about 1.2 million wallets fell under the drop. And this is another clear example that a Sybil is not a friend to a Sybil.
For some who didn’t get shaved, it was naturally beneficial for there to be about 600,000 wallets left, while others were not satisfied with this scenario. Well, we have what we have!
I cannot emphasize enough that, unlike zkSync, LayerZero looks quite transparent. And no, I am not saying that L0 didn’t distribute tokens to themselves… they probably did because everyone does: zkSync, Arbitrum, Starknet. But unlike zkSync, it was probably on a smaller scale, and I think you can see for yourself that these are fundamentally different approaches. I mean that projects cannot not distribute tokens to their pockets — it’s an integral part of the entire retro-hunting!
Speaking about the overall trend, we are clearly in for changes. The entire processing cycle of the top three is over! A lot of blood has been spilled, and I expect many to be pushed out of the market, if not retro drops entirely.
Now new trends are forming, particularly in processing non-TIER-1 projects. Take Fantasy, for example… In a couple of days of flips, I managed to make much more money than my main account brought me in a year+ of retro-hunting L0.
In the end, you need to understand that it’s not that TIER-1 projects have stopped rewarding, but that the competition in them is off the charts. It’s easier for projects to ignore Sybils, get FUD, and keep building rather than trying to please everyone and still getting FUD.
And remember, the size of your drop is not determined by the amount of the announced round… Additionally, I recommend reading my article after zkSync came out with a bunch of interesting and relevant takes below:
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