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ZkSync Era expects to release Token in a year

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It is reported that the initial release of ZkSync Era will not have tokens, as the network is still largely centralized. Due to the alpha phase, Matter Labs can upgrade the network

ZkSync Era expects to release Token in a year

It is reported that the initial release of ZkSync Era will not have tokens, as the network is still largely centralized. Due to the alpha phase, Matter Labs can upgrade the network code at will. In addition, the company still controls the two core components of network operation: sequencer and protector.

ZkSync Era expects to release Token in a year

I. Introduction
A. Explanation of ZkSync Era
II. ZkSync Era: Initial Release
A. Lack of Tokens
B. Centralized Network
C. Upgrades by Matter Labs
III. Control of Network Operation
A. The Sequencer and The Protector
B. The Importance of Decentralization
IV. Potential Risks
A. Threats of Control and Manipulation
B. The Need for Community Governance
V. Conclusion
A. Recap of the Main Points
# It is Reported That the Initial Release of ZkSync Era Will Not Have Tokens, as the Network is Still Largely Centralized. Due to the Alpha Phase, Matter Labs Can Upgrade the Network Code at Will. In Addition, the Company Still Controls the Two Core Components of Network Operation: Sequencer and Protector.
Decentralized finance (DeFi) has become a popular term among cryptocurrency enthusiasts in recent years. The idea of financial systems being operated without intermediaries is not only intriguing, but it also has the potential to revolutionize how we exchange value. However, with great power comes great responsibility. Ensuring that the system is secure and aligns with its core principles is crucial. One of the latest projects in the DeFi space is ZkSync Era.

ZkSync Era: Initial Release

ZkSync is a layer-two scaling solution for Ethereum that uses zero-knowledge (zk) proofs, a type of cryptographic proof that hides information while proving its validity. The initial release of ZkSync Era is expected to solve many of the scalability issues of Ethereum, allowing for faster transactions and lower fees. However, it comes with some caveats.

Lack of Tokens

It is reported that the initial release of ZkSync Era will not have tokens. This means that users will not be able to transfer any assets, and they will not be able to mint or burn tokens. Since tokens are the backbone of most DeFi applications, this lack of functionality raises concerns about how useful ZkSync Era will be initially.

Centralized Network

Another issue with the initial release of ZkSync Era is that the network is still largely centralized. Typically, decentralized networks rely on community-driven governance models to ensure that the network operates in a decentralized manner. However, since ZkSync Era is still in its alpha phase, the network’s code can be upgraded at will by Matter Labs.

Upgrades by Matter Labs

While having a team actively working on improving the technology is beneficial, it also means that the company controls the network’s development. This centralized control can be a double-edged sword, where upgrades can improve the technology’s security and functionality, or they can lead to unanticipated vulnerabilities and biases. It is important to note that Matter Labs has stated that they plan to decentralize the network over time.

Control of Network Operation

Currently, Matter Labs controls the two core components of the network’s operation: sequencer and protector.

The Sequencer and The Protector

The sequencer is responsible for processing transactions in order and generating proofs for them. The protector is responsible for monitoring and protecting the network from various attacks. These two components are crucial for the network to function correctly but having them centralized in one entity poses potential risks.

The Importance of Decentralization

The core idea of decentralized finance is to have a transparent and equal system, where individual users can participate actively. A centralized network design renders the system unreliable and creates centralization.

Potential Risks

The centralization risks of the system pose a threat to the ecosystem’s safety and integrity. If a project becomes a success, there is a chance that it will grow beyond a few individuals’ control. Thus the system must be democratized and decentralized, allowing for the input of the token holders.

Threats of Control and Manipulation

A centralized system inevitably faces the issue of control and manipulation, as it provides one organization with the power to influence the direction of the network. Individuals that own tokens in the network should have a say in how it is operated, not a centralized authority.

The Need for Community Governance

It is essential to establish a transparent, community-led governance model in the future for ZkSync to become a highly successful project, aiding in genuinely decentralizing the network. Community governance would take the power of control from an individual group and place it in the hands of token holders. This would create a system by which collective decisions would be made about upgrades, vested interests and more.

Conclusion

While the initial release of ZkSync Era will not have tokens, it still presents a novel approach to Ethereum’s scalability issues. However, the risks associated with having a central organization control the network’s development are significant. The system must be democratized and decentralized, allowing for the input of token holders. Community-led governance is essential for the long-term success of the project, and a move in this direction would ensure that ZkSync remains true to the core principles of decentralized finance.
# FAQs
1. Will initial collaborators play a role in deciding the future direction of ZkSync after release?
– The team at Matter Labs has stated that future upgrades will be community-driven, but the initial collaborators also have a role in shaping the network’s direction.
2. Can users still interact on ZkSync Era without tokens?
– Users can still interact with the network without tokens, but they cannot transact assets or mint/burn tokens.
3. What are the potential risks associated with having centralized networks in the DeFi space?
– Centralized networks pose the threat of control and manipulation, as an individual group has the power to influence the network’s direction. It could compromise the decentralization of the system that is supposed to be unbiased, free and secure.
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