A crypto network just voted to abandon its standalone blockchain and unlock 27% of its token supply
GnosisDAO has authorised a plan to retire Gnosis Chain’s standalone Layer 1, a shift that can unlock roughly 350,000 staked GNO.
Under GIP-153, Gnosis Chain will change into a zero-knowledge-proven Ethereum Economic Zone rollup that settles immediately to Ethereum each block. The network will ultimately retire its unbiased validator set and inherit safety from Ethereum validators as a substitute.
That change would unlock about 350,000 GNO at present dedicated to staking, equal to roughly 27% of the token’s circulating supply. The tokens are already counted as circulating supply, however ending staking would make them liquid once more and take away their present function in securing Gnosis Chain.
GNO rallied 10% to as high as about $136 across the governance choice, its highest degree since May, CryptoSlate data confirmed. The transfer got here regardless of the prospect of a large improve in liquid GNO and mirrored investor consideration on Gnosis’ deeper integration with Ethereum.
The approval is a direction-level mandate quite than a closing launch choice. GnosisDAO didn’t approve funding or a accomplished technical design, and the primary EEZ model is focused for round December 2026 or January 2027, relying on required infrastructure being prepared.
GNO loses its staking function as Gnosis turns to Ethereum
The transition may also pressure Gnosis to rethink GNO’s economics after staking disappears.
Gnosis at present pays validator rewards from its treasury as a result of network charges cowl solely a fraction of its safety prices. GIP-153 estimates that mannequin dilutes non-stakers by about 2.3% yearly. Once the validator set is retired, the staking subsidy would finish and Gnosis intends to hyperlink GNO as a substitute to income generated by the rollup.
The precise mechanism stays unresolved. Gnosis is contemplating choices together with charge sharing or GNO buybacks tied to network income, with a separate governance proposal anticipated after the economics of working the rollup change into clearer.
The broader guess is that Gnosis may give purposes direct entry to Ethereum’s liquidity with out requiring customers to bridge belongings between separate networks. Its deliberate synchronous composability would permit a Gnosis contract to name an Ethereum contract and use the end result inside the similar atomic transaction.
Martin Koeppelmann, Co-Founder and CEO, informed CryptoSlate:
“Ethereum isn’t scaling into one financial system; it is scaling into 100 islands. This proposal is Gnosis selecting the opposite path. After the transition, anybody with a mainnet pockets will probably be ready to use a Gnosis dapp in a single transaction, and a Gnosis account will probably be ready to use something on Ethereum. Same block, no bridges.”
Notably, a number of DeFi tasks, together with Aave, Spark, Fluid, CoW Swap, Safe, Centrifuge and different tasks have dedicated to constructing consumer-focused merchandise within the setting.
The transition comes with a decentralization trade-off. Gnosis Ltd. is predicted to function the sequencer that originally orders transactions and produces blocks, whereas proofs and settlement transfer to Ethereum. GIP-153 explicitly describes the transfer towards a much less decentralized execution layer as deliberate.
For GNO holders, the change subsequently replaces one established supply of token utility with an unfinished income mannequin whereas concurrently releasing a big block of staked tokens again into liquid markets.
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