Altcoin
zkSync’s token launch sparks debate: Here’s all you need to know
The long-awaited announcement comes with controversy but ZKSync holds its own.
- The project disclosed 17.5% of the total 21 billion supply would go its early users.
- However, the TVL dropped to $133 million amid debate about fairness with the distribution.
Layer-2 scaling solution for Ethereum [ETH], ZKSync, has announced the date for its token launch. According to the announcement, the ZK token would launch on the 17th of June.
However, the disclosure seemed to have caused controversy especially, among early users of the protocol. zkSync began development on its Mainnet in 2023.
The fundamentals of the project attracted a lot of users to the network. There was also speculation that the project would reward its community with the ZK token which ZKSync seemed to have fulfilled.
Not everyone is happy
In the announcement dated 11th of June, the protocol said “ZK is the Endgame.” It also gave information about the token distribution. From the information AMBCrypto got, 17.5% of the total 21 billion supply would go to its community.
In addition, the team and investors would get 16.1% and 17.2% respectively. Others were dedicated to the token assembly and ecosystem initiatives.
Source: ZK Nation
With respect to this, the project disclosed that,
“17.5% of the overall supply will be distributed through a one-time airdrop. The rest will be distributed over time, through ecosystem initiatives, managed by the ZKsync Foundation, and the ZK Nation governance process, to support a growing ecosystem as new users come onchain.”
However, the development did not go down well with some of the early users. At press time, AMBCrypto found series of comments noting that the distribution was unfair.
On X, a certain user with the handle “Caneleo” mentioned that the maximum allocation should have been 20,000 tokens. According to him, this would have allowed ZK to reach some wallets that were considered ineligible.
TVL tanks, but will ZK launch at $1?
At the same time, ZKSync explained how it arrived at the distribution. It noted that 89% of the 17.5% were allocated to those who transacted a substantial figure on the network.
The remaining 11% went to developers, researchers, and the likes. Nonetheless, the clarification did not change the opinions of some of the ineligible users.
Furthermore, the Total Value Locked (TVL) of ZKSync had begun to tank at press time. The TVL measures the value of assets locked or staked in a protocol.
A few weeks back, the TVL of ZKSync Era was almost $200 million. This surge was caused by the trust that participants had in the protocol that it would yield a good return.
However, at press time, the value was down to $133.03 million. The recent decrease implied that users were increasingly withdrawing their assets from the protocol.
Realistic or not, here’s ZK’s market cap in ETH terms
Should this continue, the TVL might drop as low as $100 million. In the meantime, there have been predictions about the ZK token with some saying it could hit $1 at launch.
However, details from Whales Market, a pre-listing platform, showed the price trading at $0.34 as of this writing.
