Ethereum scaling solution StarkWare announces token launch

StarkWare, an Ethereum scaling solution that uses cryptographic proofs called Starks to help scale the blockchain, has launched a native governance token, details shared on Wednesday show.

The startup says the token, dubbed “StarkNet Token”, is a critical step in the platform’s decentralization following its mainnet launch on Ethereum in November 2021.

“A new, native, StarkNet Token is needed to operate the ecosystem, maintain and secure it, decide on its values and strategic goals, and direct its evolution,” StarkWare said in the announcement.

Why the StarkWare token?

StarkNet is a protocol designed to for and to be run by the community, and the token provides for that critical vision, the platform posted. Accordingly, it provides for ecosystem governance and guarantees a reward system to those helping secure the network.

According to the L2 platform, the new token will help achieve three things in the StarkNet ecosystem: it will be used for governance, as a payment token for transaction fees, and for staking within the platform’s consensus mechanism.

An initial 10 billion tokens minted

StarkWare announced that a total of 10 billion StarkNet tokens have been minted ahead of launch as an ERC-20 token. The startup is allocating the newly minted tokens to several core groups, including ecosystem investors, software developer partners, and the StarkNet Foundation.

The token allocation will see 17% go to StarkWare investors while 32.9% will go to Core Contributors (employees, consultants, software developer partners).

The majority, 50.1% of the initial supply will go to the Foundation, with various percentages allocated to different groups. Community users prior to 1 June 2022 have 9%, another 9% to rebates, 12% is set aside for research grants, 10% for strategic reserves and 2% for donations.

8.1% will remain unallocated and its use will be decided by the community,

The plan is also to have the token go live on Ethereum, with more minted after that. Staking to contribute to network security will be possible in 2023, according to the platform.