LayerZero’s ZRO Token Airdrop Receives Backlash For ‘Proof-Of-Donation’ Mechanism
This week, another airdrop controversy has sent the crypto community into havoc. Omnichain interoperability protocol LayerZero recently announced its ZRO Token launch alongside an Airdrop for its community. However, investors were shocked when the protocol announced the new ‘Proof-of-Donation’ mechanism. The token’s price has dropped over 20% after launching. LayerZero Faces Backlash For Token Airdrop On June 14, the LayerZero Foundation took X to tease an upcoming airdrop. That day, Bryan Pellegrino, the co-founder and CEO of LayerZero Labs, shared the key details of the airdrop. The CEO revealed a 1 billion ZRO tokens supply and the community would directly receive 23.8% of them. He explained that 8.5% of the community-allocated tokens would be distributed on the first day, while the rest would be given throughout the following 36 months. In May, the protocol announced its anti-Sybil measures for the upcoming token distribution. The measures include a self-reporting system for Sybil accounts, which offered 15% of the intended allocation to the addresses that report itself. Additionally, LayerZero created a bounty hunter program. Despite this, the protocol received some backlash for its distribution. Some users believe an 8.5% distribution on the first day was too low. Others felt like their allocated tokens didn’t match their transaction volume. An x user shared he received 39.28 ZRO despite being among the top 0.13% LazerZero users. As a result, many compared the ZRO airdrop to zkSync’s one. Last week, the crypto community slammed Ethereum’s Zero-Knowledge Layer-2 scaling solution zkSync ahead of its ZK token airdrop. At the time, investors expressed frustration with the token allocation and lack of anti-Sybil filtering. From Hero To ZRO? Despite the comparison to zkSync, it wasn’t until Thursday that the backlash intensified. Before the airdrop, LayerZero Foundation announced its new claiming mechanism, ‘ Proof-of-Donation.’ LayerZero announces the ‘Proof-of-Donation’ mechanism. Source: LayerZero Foundation on XPer the post, users must donate $0.1 in USDC, USDT, or ETH per token to claim their ZRO allocation. The donations will go directly to the Protocol Guild, a collective funding mechanism for Ethereum developers. LayerZero Foundation estimated that the new mechanism will generate up to $18.5 million in donations. Additionally, it offered to match all donations up to $10 million. The protocol’s community quickly expressed their disagreement with the news. One user called it a “Pay to Claim” airdrop, stating that “if there was a ‘milking your users’ Olympics, LayerZero would take the gold.” Another user found the timing disingenuous, as the announcement was made soon before the airdrop. Many investors saw the “mandatory” nature of the donation as a slap in the face. Moreover, some consider the new claiming mechanism a “tax” instead of a donation. Pellegrino addressed the criticism of X, stating that nobody is forced to donate. He added that users are not entitled to the tokens: If you don’t want to donate… simply don’t claim. This is not something you own, it’s something being offered. As of this writing, ZRO has gone from $4.79 to $3.39, representing a 22% drop in four hours. ETH is trading at $3,495 in the three-day chart. Source: ETHUSDT on TradingViewFeatured Image from Unsplash.com, Chart from TradingView.com Rubmar Garcia Rubmar is a writer and translator who has been a crypto enthusiast for the past four years. Her goal as a writer is to create informative, complete, and easily understandable pieces accessible to those entering the crypto space. After learning about cryptocurrencies in 2019, Rubmar became curious about the world of possibilities the industry offered, quickly learning that financial freedom was at the palm of her hand with the developing technology. From a young age, Rubmar was curious about how languages work, finding special interest in wordplay and the peculiarities of dialects. Her curiosity grew as she became an avid reader in her teenage years. She explored freedom and new words through her favorite books, which shaped her view of the world. Rubmar acquired the necessary skills for in-depth research and analytical thinking at university, where she studied Literature and Linguistics. Her studies have given her a sharp perspective on several topics and allowed her to turn every stone in her investigations. In 2019, she first dipped her toes in the crypto industry when a friend introduced her to Bitcoin and cryptocurrencies, but it wasn’t until 2020 that she started to dive into the depth of the industry. As Rubmar began to understand the mechanics of the crypto sphere, she saw a new world yet to be explored. At the beginning of her crypto voyage, she discovered a new system that allowed her to have control over her finances. As a young adult of the 21st century, Rubmar has faced the challenges of the traditional banking system and the restrictions of fiat money. After the failure of her home country’s economy, the limitations of traditional finances became clear. The bureaucratic, outdated structure made her feel hopeless and powerless amid an aggressive and distorted system created by hyperinflation. However, learning about decentralization and self-custody opened a realm of opportunities. Cryptocurrencies allowed her to experience financial control for the first time and expand her financial education. Moreover, the peculiar nature of the crypto community sparked Rubmar’s curiosity about the other layers of the industry. As a result, she found a particular interest in discovering the diverse perspectives of investors, market watchers, experts, and developers. Her attempts to better understand the crypto space made her realize the strong links of the community with other industries, enriching her perspective of the sector. As someone who spends most of her day online, Rubmar enjoys finding the points where the crypto world meets with her other passions and hobbies –or her favorite memes. In her free time, she usually finds joy in different art forms. As a child, she enlisted in every extra-curricular activity in her hometown, including music classes, dancing, jewelry making, and the local chorus. Despite her many attempts to learn different instruments, Rubmar only knows how to play the xylophone, which she played for 7 years in her school’s marching band. She also has a passion for learning new languages and cultures, having set the goal to learn another six languages – currently attempting to learn Italian and Korean. Scrapbooking, paper crafting, and bookbinding are her biggest interests outside of work, constantly taking classes and attending workshops to learn new techniques. The rest of her free time is spent stressing over football matches and transfer market news or feeding cats –hers or stray. In summary, Rubmar seeks to present entertaining and educational pieces to be enjoyed by everybody, aiming to report on the latest news and offer a unique perspective while adding a meme or a pun whenever possible. Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.