LayerZero, the cross-chain messaging and communication protocol, launched its native token, ZRO, last week. With a total supply of 1 billion, the token opened with an FDV valuation of $4 billion before reaching a short-term high of $4.7 billion FDV. Since then, its value has steadily declined and, at the time of writing, is at $3 billion FDV, on par with rival Wormhole (W), which launched its token earlier this year.
Details of the ZRO (TGE) token generation event are as follows: 25% of tokens unlocked on Day 1, with 8.5% available immediately at TGE, 11.0% reserved for future snapshots and Claims Proposals (RFPs), 5% are allocated to the LayerZero Foundation, and 0.5% are distributed to community members.
However, the airdrop did not come without its share of drama. An unexpected twist in receiving airdrops has sparked heated debate, with many people both criticizing and defending the protocol.
In a post before receiving began, LayerZero announced it would introduce a new mechanism called “Proof-of-Donation,” requiring recipients to donate $0.10 in USDC, USDT, or ETH for each ZRO. The donation supports The Protocol Guild, an initiative designed to support Ethereum’s core protocol contributors by providing them with financial incentives and resources. According to LayerZero, this mechanism will generate up to 18.5 million USD in donations for the Protocol Guild. LayerZero also announced plans to match these donations up to $10 million.
Some spoke out against the new requirement, arguing that this “mandatory donation” criterion felt contrary to the nature of the airdrop, which is a reward for contributing and using the protocol. Others praised the group’s efforts in spearheading the initiative and raising a large amount of capital for the cause. At the time of writing, 57.5% of ZRO tokens have been claimed.
The airdrop also ends a weeks-long campaign led by LayerZero founder Bryan Pellegrino against sybils who were simply using the protocol to accumulate larger airdrops. Pellegrino said 1.28 million wallets out of a total of 6 million unique wallet addresses that have interacted with the LayerZero protocol are eligible to receive the airdrop.
A quick reminder: the LayerZero airdrop has been heavily attended over the past weeks as Bryan and the team worked hard to hunt down thousands of industrial airdrop sybils who sought to maximize their airdrop allocation . These users are not ideal for protocols because often they withdraw any collateral and leave the protocol.
LayerZero partnered with Nansen and Chaos Labs to identify these wallet clusters. Initial analysis has identified more than 800,000 addresses as potential sybils.
As a result of many sybils leaving the protocol, the number of daily messages on LayerZero dropped 90% from 348,000 messages the day before the snapshot to a low of 31,000 on June 17 before rising again to 300,000 on last weekend.
The majority of the airdrops will continue to be distributed to users over the next 36 months with additional retroactive distributions taking place every 12 months, according to Pellegrino. It will be interesting to see if this level of activity is maintained in the coming months.
Thach Sanh
According to The Block
