ZKsync Launches Decentralized Governance System with On-Chain Contracts

SUMMARY

ZKsync has launched its decentralized governance model, allowing the community to participate in key decisions, with power distributed among the Token Assembly, Security Council, and Guardians.
Despite this launch, the network has seen a sharp 85% decline in daily transactions, presenting a challenge to the new governance system.

ZKsync, an EVM-compatible ZK rollup, has formally launched its decentralized governance model, with smart contracts now active on the mainnet. This governance framework, built on a decentralized network, permits the community to take an interest directly in key decisions regarding the protocol’s future. It is outlined around three primary bodies: the Token Assembly, Security Council, and Guardians, to guarantee a reasonable and balanced distribution of governance control over the ecosystem. ZKsync detailed this structure in a recent blog post.

The governance model places a solid emphasis on decentralization. The Token Assembly, comprising of token holders and their delegates, has the power to propose and vote on any proposed changes to the protocol. The Security Council is made up of security specialists responsible for investigating and approving code changes to guarantee the system’s security. Meanwhile, the Guardians hold veto control to guarantee that all decisions align with the core values of ZKsync and maintain the integrity of the system.

No single entity holds overarching control in this governance structure, and this plan is meant to reflect the standards of decentralization that ZKsync endeavors to embody. The governance framework was reported as part of a broader vision detailed in June 2024, following the launch of the Era mainnet in March 2023. The presentation of the ZK token, alongside an airdrop, was another major component of this plan to deliver more control and influence to the community.

However, despite the launch of this new governance model, the ZKsync network has confronted a notable drop-in activity. Since the start of the year, the seven-day moving average of daily transactions has diminished by roughly 85%. The transaction count dropped from around 1.3 million per day to around 195,000, according to information from The Block’s dashboard.

This decrease in network action poses a challenge for the recently actualized governance framework. Whereas the decentralized model guarantees more noteworthy community involvement, the sharp decrease in transactions raises questions about how the community will address and adapt to this downturn in utilization. The future of ZKsync depends not only on the success of its governance framework but also on its ability to regain network momentum.

The activation of decentralized governance marks a significant moment for ZKsync, but the community’s role will be crucial in steering the network through these recent challenges, aiming for a balanced and sustainable future.