ZKSync founder Alex Gluchowski announced a major overhaul of the ZK token’s economic model in a detailed proposal titled “ZK Token Proposal Part I.” This update shifts the ZK token from primarily a governance tool to a utility-driven asset, directly linking its value to network revenue and activity.
The goal is to create a self-sustaining “value flywheel” that rewards usage through buybacks, burns, and ecosystem incentives, addressing criticisms of the token’s limited utility since its airdrop in June 2024.
Core Changes in the Proposal
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The redesign focuses on two primary revenue sources—on-chain and off-chain—and routes all proceeds to a community-governed entity for ZK token management.
Fees from cross-chain messaging, transfers, and interoperability via the ZK Gateway across the entire Elastic Network (e.g., ZKSync Era, Abstract, Sophon, Lens, ADIChain, and 20+ other ZK Stack chains). This excludes direct ZKSync Era transaction fees, emphasizing ecosystem-wide activity.
Generates organic demand; fees fund buybacks and burns, creating deflationary pressure as network usage grows. Off-Chain Revenue (SaaS/Enterprise Licensing)
Licensing fees from “Prividium” blockchains built for institutions and businesses (e.g., compliance-focused chains for finance). Includes potential sequencer income from running these chains. Diversifies income beyond crypto; all proceeds support staking rewards, protocol development, and grants, tying token value to real-world adoption.
Value Redistribution; 100% of revenues pooled for: Token buybacks and burns (deflationary). Staking incentives (Q4 2025 rollout). Ecosystem grants for growth. Community governance decides allocation via on-chain votes, promoting transparency and long-term holding over speculation.
Integrates with the Elastic Network expansion (10+ new chains by 2026) and Atlas upgrade (15,000+ TPS, 1-second ZK proofs, near-zero fees). Positions ZK as the unifying token for a multi-chain ZK ecosystem, enhancing interoperability and scalability on Ethereum.
This model evolves ZK into an “ecosystem token” rather than a siloed governance asset, with Gluchowski emphasizing: “ZKsync has been building the rails for Incorruptible Finance for years; now, we move to the next phase building the real economy around it.”
The announcement sparked immediate bullish sentiment, with $ZK surging 24% in 24 hours to ~$0.075 market cap ~$550M as of November 5, 2025—up 170% from its October low of $0.028. Weekly gains hit 67%, outperforming a broader market dip of 3%.
Analysts highlight the utility shift as a catalyst for sustainable growth, though upcoming unlocks 167M ZK on November 17 could introduce short-term sell pressure.Technical outlook remains positive: $ZK is consolidating above $0.048 support and the 9 EMA, maintaining a higher-high/higher-low structure.
A break above $0.067 could target $0.075 retests, while a drop below $0.045 risks a pullback to $0.030. Community and Expert On X, users like @BowTiedGolem— Matter Labs BD manager praised the “entirely new tokenomics paradigm” for aligning revenue with growth across 20+ chains.
Joinelastic called it “organic value feedback” for the Elastic Network, countering “pump and dump” narratives. Vitalik Buterin previously backed ZKSync’s Atlas upgrade, indirectly boosting confidence in the ecosystem.
While revenue has reached $30M lifetime per DeFiLlama recent annual figures are low (~$640K), so execution on interop and enterprise adoption is key. The proposal is “Part I,” with more details expected.
This update positions ZKSync as a leader in modular ZK scaling, potentially driving $ZK toward $0.125+ in 2025 if adoption accelerates. For the full proposal, check Gluchowski’s X thread or ZKSync’s governance forum.