Ethereum layer 2 network Arbitrum saw its daily revenue soar to a record $3.4 million (ETH) on Thursday due to increased activity related to the launch of ZRO token claims on its coordination chain LayerZero.
Arbitrum’s June 19 revenue was only $20,000. This shows daily revenue soaring more than 16,500% on Thursday, according to the Dune dashboard compiled by datawarlock.
“Arbitrum was one of the biggest winners of the LayerZero airdrop,” said Austin Marrazza, product manager at Arbitrum developer Offchain Labs. “DAO made $3 million in congestion fees today by charging traffic.”
Profit decision. Image: Dune Analysis.
The LayerZero Foundation, the organization behind LayerZero, a cross-chain interoperability platform, began claiming airdrops for native ZRO tokens at 7 a.m. ET on Thursday and will remain open until September 20.
Approximately 85 million ZRO tokens, or 8.5% of the total supply of 1 billion, can be claimed by eligible participants, while the remaining tokens are reserved for future distribution programs, ecosystem growth, strategic partners and key contributors. Bryan Pellegrino, CEO of LayerZero Labs, previously identified a total of 1.28 million wallets eligible for the airdrop.
LayerZero asks eligible users to pay 10 cents per ZRO to claim the airdrop.
However, the foundation later announced that to claim ZRO, users must donate $0.10 per ZRO token in USDC, USDT, or ETH to support the Protocol Guild, a non-profit funding collective for Ethereum core researchers and developers.
The new “Proof of Donation” billing mechanism is designed to generate up to $18.5 million for Protocol Guild, with the LayerZero Foundation matching donations of up to $10 million, with donated funds vesting over four years.
The new charging mechanism has faced criticism from some in the cryptocurrency community. They view mandatory donations as a disguised form of funds or taxes rather than true airdrops. This is intended to reward user contributions and decentralize the protocol in general.
Pellegrino responded on Thursday: “There is no forced donation. If you don’t want to donate… don’t insist. This is something you are given, not something you own.”
Arbitration fees soar
Arbitrum benefits from being used as the coordination chain for LayerZero token billing contracts, processing claims atomically without any additional LayerZero messaging.
Eligible users can also claim ZRO on Ethereum, Optimism, Base, Polygon, BNB Chain, and Avalanche, but LayerZero cross-chain messaging is required to facilitate claims on these networks.
As a result, Arbitrum’s median gas price surged from 0.01 gwei to 34.7 gwei before falling to similar levels as activity subsided.
Arbitrum medium gas price. Image: Dune Analysis.
The surge in gas prices coincided with Arbitrum’s average daily trading fee jumping to $0.89 on Thursday. This is less than a cent more than the typical fee. They have since returned to that baseline.
LayerZero’s ZRO token is currently trading at $3.15, according to CoinGecko data. It has a market capitalization of $796 million, a fully diluted value of $3.2 billion, and trading volume in the last 24 hours of nearly $1 billion.
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