LayerZero’s token launch on June 20 caused a significant increase in fees on Arbitrum, resulting in a record daily revenue of $3.43 million for the blockchain. This represented a surge of approximately 16,680% compared to the previous day.
LayerZero introduced the ZRO token on Thursday, but it faced criticism for its mandatory “donation” mechanism. This mechanism required claimants to spend a small amount of money per token to secure their allocation. As a result, the average gas fees on the blockchain rose to 89 cents, a significant increase from the usual less-than-1-cent fee.
Consequently, the network’s profits skyrocketed to $3.29 million on that day, marking another record high for Arbitrum, according to data from Dune Analytics and DefiLlama.
LayerZero implemented a requirement for ZRO token claimants to donate a small amount of money per token. “To claim ZRO, users must donate $0.10 in USDC, USDT, or native ETH per ZRO,” LayerZero stated in a post on June 20. It further explained that the donation would go to the Protocol Guild, which supports Ethereum developers.
LayerZero justified its token launch by stating that it was not an airdrop. The company argued that airdrops were not aligned with the goals of fair distribution, community building, and protocol health, as many recipients had little to no long-term interest in the project.
This surge in revenue represents Arbitrum’s most profitable day since earning $2.13 million in revenue on December 14, the day before it experienced a network overload and went offline.
Inscriptions, a form of data formatting capable of carrying larger packages of information, such as images, contribute to the increased fees. The size of these inscriptions makes them expensive to process. As a result, Arbitrum incurred higher costs to post and verify the costly inscription data on Ethereum, resulting in a profit of only $414,000 on December 14.
On the other hand, the ZRO token’s value has declined by 23% in the last day, reaching $3.42. It previously reached a peak of $4.79, according to CoinGecko.
Related:
LayerZero’s anti-Sybil strategy exposes tensions in the DeFi industry.
Ronin, driven by bots and airdrops, has become the second most popular blockchain for daily users, attracting the attention of Not Pixels fans.