Quick Overview:
LaterZero (ZRO) token surged 15.15%, then dropped 22%, stabilising at $3.35.
The required $0.10 donation per token aims to raise $18.5 million, matched by LayerZero.
Mandatory donation is criticised as a tax; supporters see it as an innovation against Sybil’s attacks.
The much-anticipated ZRO token launch occurred on June 20, 2024. The initial surge saw the token price rise by 15.15% to reach $4.71 within the first 20 minutes of trading. However, this early momentum was short-lived, as the token’s value dropped just two hours later. Therefore ultimately stabilising at a current price of $3.35. This represents a 17% decline from its pre-market price of $4.27, according to CoinMarketCap.
Proof-of-Donation Mechanism Aims to Raise $18.5M
The ZRO token claim process introduced a novel “proof-of-donation” mechanism, requiring users to donate $0.10 per token in USDC, USDT, or ETH. This approach aims to raise $18.5 million, with the LayerZero Foundation pledging an additional $10 million in donation matching. The concept behind this initiative is to align recipients with the long-term goals of the LayerZero protocol and support the future of cryptocurrency.
ZRO began trading at noon UTC on June 20, 2024. Simultaneously, Binance is one of the key exchanges listing the token. The pre-market excitement and subsequent listing led to the initial price surge, but the sharp drop that followed has raised concerns among investors about the token’s short-term stability and long-term value.
Community Debates Mandatory Donation for ZRO Tokens
The introduction of the mandatory donation for token claiming has sparked significant debate within the crypto community. Critics argue that this mechanism is essentially a tax, altering the traditional nature of airdrops, which are typically free distributions based on user interaction with a blockchain or its related products. Comments from disgruntled users highlight their displeasure, with some labelling the donation requirement as a joke or an unfair financial burden.
Conversely, supporters believe this innovative approach could address issues observed in recent token airdrops, such as Sybil attacks, where multiple fake identities are created to exploit the distribution system. Proponents argue that the donation requirement could deter such activities, promoting a healthier and more equitable distribution of tokens. They also praise the user experience of the claim page, comparing its seamlessness to popular consumer apps like Spotify Wrapped.
ZRO Defends Proof-of-Donation as Optional
LayerZero has defended its approach, stating that the donation is not mandatory; those who do not wish to donate do not claim the tokens. This, they argue, shifts the airdrop from being an entitlement to an offer. The LayerZero team has emphasised that traditional airdrops no longer serve equitable distribution, community building, and protocol health goals. The proof-of-donation mechanism, therefore, represents an attempt to innovate and improve these processes.
ZRO, a protocol focused on cross-chain interoperability, has positioned this airdrop as a significant step in its ongoing development. The controversy surrounding the donation requirement stems from its deviation from traditional airdrop practices, where donations if solicited, are voluntary.
Previous airdrops like ZkSync have faced challenges with Sybil wallets bypassing detection mechanisms. LayerZero’s approach aims to mitigate these issues by making the donation a prerequisite for claiming tokens.
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