Author: Ciaran Lyons, CoinTelegraph; Translated by: Tao Zhu, Golden Finance

LayerZero (ZRO), the newly launched token of cross-chain interoperability protocol LayerZero, fell 17% just one day after its launch as its founder defended the controversial donation criteria for receiving the tokens, which some likened to a “tax.”

Some disagree and believe that the mechanism could be the right step to address the issues plaguing recent token airdrops.

After launching on June 20, ZRO surged 15.15% to $4.71 in just 20 minutes before plummeting 22% in two hours, a pattern that often occurs in token airdrops as people sell off their newly acquired tokens.

In this context, the launch of ZRO also brings its own unique controversy. LayerZero has made it so that users who want to claim the tokens need to donate a small amount of money for each ZRO token.

Source: LayerZero Foundation

“To claim ZRO, users must donate $0.10 USDC, USDT, or native ETH for each ZRO. This small donation will go directly to the protocol association,” LayerZero wrote in a June 20 post.

LayerZero predicts that these donations will contribute approximately $18.5 million to the Protocol Guild, the collective funding mechanism for ethereum developers.

The move was met with strong opposition from the crypto community, as users felt that having to pay a “tax” would change the nature of the “airdrop” to be more like an initial coin offering (ICO).

Users flocked to LayerZero's post with comments including "is this a joke" and "how about you pay for this".

LayerZero Confirms ZRO Launch ‘Not an Airdrop’

LayerZero insists the recent launch is “not an airdrop.”

In a June 20 statement, LayerZero argued that the airdrop no longer contributes to the “goals of fair distribution, community building, and protocol health that the airdrop was originally intended to address.”

This is largely due to an increase in airdrop mining and Sybil entities (entities that create and use large numbers of wallets to conduct airdrops), with token recipients having “little to no interest” in the long-term success of the project.

LayerZero co-founder Bryan Pellegrino seemed to defend the token launch throughout the day, reiterating that no one is entitled to the tokens and that if users don’t want to donate, they should refrain from claiming them.

"There is no forced donation, if you don't want to donate ... don't ask for it. It's not something you have, it's something that is offered," he said.

ZRO briefly hit a high of $4.7 before falling below $3.50. Source: CoinMarketCap

"What a surreal day, I've never been so tired in my life. Turning off notifications and heading to sleep for an unknown amount of time. Fingers crossed," Pellegrino added.

Meanwhile, some members of the cryptocurrency community agree that ZRO’s donation claiming mechanism could be a step in the right direction for future airdrops.

“People complaining about the LayerZero airdrop donation are stupid,” Adam Cochran said in a June 20 post, explaining that the donation will be used to support the “greater ecosystem” and is “a great way to set a base cost value for the project.”

“It’s a good way to increase the cost of Sybil operations, making them less likely to perform Sybil attacks in the future,” he explained.

Last week, ZkSync noted that despite using “explicit” Sybil detection and a “unique airdrop design” to ensure the maximum number of organic users during the June 17 airdrop launch, some Sybil wallets were able to bypass the system.

"While people are sneering at the ZRO airdrop, I want to give it some praise because the claims page UI/UX is so clean and by far the smoothest I've seen. It's like Spotify Wrapped," added Irys developer Connor King.

According to CoinMarketCap data, ZRO is currently trading at $3.35, down 17% in the past 24 hours.