The LINEA token, the native cryptocurrency of the Linea network, introduces an innovative approach to ecosystem development and user incentivization. Unlike many other Layer-2 solutions, the LINEA token is not used for paying gas fees on the network; instead, transaction fees on Linea are paid in ETH.
This design choice reinforces Linea's strong alignment with Ethereum's economy. The primary role of the LINEA token is to foster a vibrant and sustainable ecosystem by rewarding users, developers, and liquidity providers.A staggering 85% of the total LINEA token supply is allocated to ecosystem growth.
This includes airdrops to early users, incentive programs, developer grants, and funding for public goods. This community-focused distribution model is a deliberate move away from traditional tokenomics that often heavily favor insiders and early investors. By placing the majority of the tokens in the hands of the community, Linea aims to cultivate a more open, decentralized, and user-driven network.
A key feature of Linea's economic model is the dual-burn mechanism. While 20% of the net transaction fees collected in ETH are burned to contribute to Ethereum's scarcity, the remaining 80% are used to buy back and burn LINEA tokens. This creates a deflationary pressure on the LINEA supply, directly linking the token's value to the activity and usage of the network.
As more transactions are processed on Linea, more LINEA tokens are removed from circulation, potentially increasing the value for token holders.The utility of the LINEA token extends to its role in fueling the growth of decentralized finance (DeFi) on the network. With bridged ETH being natively staked, liquidity providers can earn a yield, creating a capital-efficient environment for DeFi protocols.
This native yield, combined with the incentive programs powered by the LINEA token, is designed to attract a wide range of dApps and users, from decentralized exchanges and lending protocols to NFT marketplaces and gaming applications.
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