The ZRO token is the native governance and utility token for the LayerZero protocol, a decentralized, omnichain interoperability protocol that enables secure, cross-chain communication and asset transfers across 150+ blockchain networks. Launched in June 2024, ZRO plays a critical role in managing the LayerZero ecosystem, which aims to act as a "chain of chains" for Web3 infrastructure.
Here is a detailed overview of the ZRO token:
1. Key Functions of ZRO
Governance: ZRO holders govern the protocol, influencing upgrades, integrations, and fee structures through on-chain, and potentially cross-chain, voting.
Protocol Fee Management: While transaction fees can be paid in the native token of the source chain, the protocol includes a fee-switch mechanism. ZRO holders can vote every six months to activate or deactivate this fee, with revenue potentially used to burn ZRO.
Incentivizing Participation: ZRO is used to incentivize the network's participants, including those operating Decentralized Verifier Networks (DVNs) and Executors (previously Oracles and Relayers in V1).
Staking: In conjunction with V2, ZRO is used for staking within the DVN framework to enhance network security and ensure accurate message validation.
2. Tokenomics and Distribution
The total supply of ZRO is capped at 1 billion tokens.
Allocation: 38.3% is designated for the community (including the initial airdrop and future initiatives), 32.2% for strategic partners (investors/advisors), and 25.5% for core contributors.
Vesting: Investor and contributor tokens are subject to a 3-year vesting period (1-year lock-up followed by 2 years of monthly unlocks).
Circulating Supply: Upon launch, the initial circulating supply was roughly 250 million tokens, which is set to increase gradually over three years.
