ZKsync launched a decentralized governance model with smart contracts live on mainnet, involving three key bodies for decision-making.
The Token Assembly, Security Council, and Guardians ensure balanced governance, focusing on security and decentralization.
ZKsync's transaction volume dropped by 85% in 2024, despite the new governance model aimed at increasing community involvement.
ZKsync, a decentralized governance model of Ethereum-compatible rollup has been formally activated on the mainnet. The governance structure, which uses a multi-body framework intended to avoid centralized control, allows the community to actively participate in protocol decision-making. The company that created ZKsync, Matter Labs, wants to divide up the governance authority among the Guardians, Security Council, and Token Assembly.
https://twitter.com/zksync/status/1834257648994140289 ZKsync’s Governance System Takes Shape
Notably, the implementation of the governance model comes after ZKsync's comprehensive plan was made public earlier this year. In March 2023, the ZKsync Era mainnet went live, and in June 2024, more information regarding governance became available. This governance structure was made possible through the airdrop that coincided with the ZK token launch.
However, even with these advancements, ZKsync has seen a notable decline in transaction volume. Data indicates that since the start of 2024, the daily transaction count on the network has dropped by almost 85%.
Hence, the abrupt drop in daily transactions from roughly 1.3 million to just under 200,000 begs the question of what immediate effects the system will have on network activity. However, it is anticipated that the governance model will offer a structure for dealing with these issues in the future.
Focus on Security and Decentralization
Notably, a key element of the new governance framework is security. ZKsync requires expert review of all code changes in order to prevent protocol vulnerabilities now that the Security Council is in place.
Furthermore, the Guardians also make sure that the core principles of decentralization are upheld in all decisions and proposals. ZKsync aims to establish a more secure and community-driven system by distributing decision-making authority among these bodies in an equitable manner.
Hence, this strategy fits with ZKsync's overarching objective of promoting decentralization without compromising security. By actively participating in the Token Assembly, the community reduces the risks associated with centralized control while enabling transparent governance.
Looking Ahead: What’s Next for ZKsync?
Moreover, it is anticipated that ZKsync's future course will be determined by the activation of the governance model. The next phase of the protocol, which puts the community at the center of decision-making, will probably concentrate on boosting participation and improving the governance structure.
Although the decline in transaction volume is still concerning, the new governance structure offers resources to deal with these problems.
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