The non-profit behind the layer 2 will distribute tokens to past and future contributors, refund some transaction fees and promote DeFi protocols within the ecosystem.
Eli Ben-Sasson, co-founder of Starknet parent company StarkWare
Posted December 8, 2023 at 10:12 am EST.
The Starknet Foundation, the non-profit created to promote the blockchain scalability solution, announced on Friday that it plans to allocate 1.8 billion Starknet (STRK) tokens across multiple initiatives aimed at promoting the adoption and growth of the blockchain.The first allocation will happen “soon,” according to the foundation’s X account.
Starknet is a so-called layer 2 that uses zero-knowledge (zk) rollup technology to bundle hundreds of transactions off-chain before sending the bundle to the main Ethereum blockchain. The setup eases the slow throughput and high gas or transaction fees common on Ethereum.
Starknet has allocated 900 million STRK tokens to its Provisions committee to reward both past and future contributions from users and community members. Another 900 million tokens are designated to compensate users for transaction fees related to essential activities on the network, although the details of this plan are still being formalized. Additionally, 50 million STRK were set aside to foster the growth of decentralized finance (DeFi) protocols on Starknet.
The latest token plans follow an October announcement that the Starknet Foundation had set aside 50 million STRK tokens for a new Early Community Member Program. STRK tokens haven’t begun trading yet so it’s not possible to estimate the value of the awarded tokens. The tokens that have been distributed to date have a lockup period that means the tokens can’t be traded until April 2024.
Starknet parent company StarkWare, which was valued at $8 billion during a $100 million funding round in May 2022, first confirmed plans for the long-rumored STRK token in July 2022. The company minted an additional initial 10 billion STRK tokens, which were to be allocated to core contributors, investors and developer partners. The Starknet Foundation launched that November and was allocated 5.01 billion of that token supply.
Starknet is currently the ninth largest Layer 2 network with $157 million in total value locked (TVL), according to L2 Beat data.
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