StarkNet Roadmap
Starkware recently released an updated roadmap for 2023. In the post, the team outlined the major technical focuses for the year (seen below). However, the post did not address the eventual token release. Regardless, let's sift through the post and see what we can uncover.
In 2023, the primary objective of StarkNet is to enhance the network performance to accommodate the anticipated growth in user and developer numbers. Performance, in this context, is characterized by not only throughput and latency but also by transaction cost. To that end, the imminent release of Starknet v0.12.0 promises substantial enhancements in these areas. These improvements stem from the work to convert the Starknet stack to Rust, resulting in the Rust-based Sequencer developed by StarkWare and the Rust-Cairo VM (cairo-rs) developed by LambdaClass, both of which are open-source projects. The transition is projected to considerably decrease block execution time, thereby increasing throughput. In the absence of congestion, transaction latency is also expected to improve, as the primary cause of latency is block execution time.
In Starknet v0.13.0, transaction costs will undergo a significant reduction. This will be achieved by targeting the primary component of transaction cost: L1 (Ethereum) data cost, which currently accounts for 95% of transaction costs. The introduction of Volition will enable developers to create Starknet applications with hybrid Data Availability (DA) modes, utilizing both on-chain and off-chain data. A forthcoming post will provide comprehensive details on Volition's design and developer interfaces.
As the releases of Starknet v0.14.0 and v0.15.0 approach, the commitment to providing users with a seamless and predictable experience on the network, regardless of congestion levels, remains steadfast. To accomplish this, two key areas of development are being prioritized: fee market and block intervals.
In the context of the fee market, the planned performance improvements will be evident to developers and users, provided that the network remains uncongested. However, when congestion occurs, it will result in increased waiting times for all users. To address this issue, a fee market will be introduced in Starknet v0.14.0, enabling efficient allocation of Starknet's limited resources based on users' willingness to pay for a transaction rather than its position in the queue.
In Starknet v0.15.0, the network will transition to constant and shorter block intervals. At present, each block is proven by its own proof, and block intervals are variable, with the conserved quantity being the block cost. To resolve this, the 1:1 relationship between a Starknet block and its proof will be decoupled. Starting with v0.15.0, a proof will attest to the integrity of one or more Starknet blocks, fixing the block interval and enhancing the Starknet user experience.
The tradeoffs considered in determining this roadmap prioritized performance enhancements, mainly achieved by increasing the Sequencer's throughput beginning with v0.12.0. In v0.13.0, the decision was made to focus on lowering transaction costs rather than improving user experience due to the expectation that v0.12.0 will deliver significantly better latency. The main lever for reducing transaction costs will be the implementation of Volition and, as further details emerge, EIP-4844.
Given all that, let's take a look at what we do know about the token.
Role of StarkNet Foundation and StarkNet Token
On July 13th, 2022, Starkware announced in a Medium post that StarkNet would have its native token and a StarkNet foundation would be set up. The StarkNet Foundation will be a non-profit organization, and StarkNet tokens will be allocated to it to help achieve its goals. Its primary goal will be to maintain StarkNet as a public good. The Foundation will also maintain ongoing protocol development, testing, documentation, and software publication.
The StarkNet Foundation and its native token will play a key role in making the StarkNet network decentralized. The StarkNet Foundation will follow these four principles to maintain StarkNet’s decentralization: Livness, Censorship resistance, Transparency, and Creativity.
On November 10th, 2022, Starkware announced StarkNet Foundation’s official launch. Foundation priorities will be making StarkNet more decentralized by developing a governance mechanism and making the process of sequencing and proving decentralized. Additionally, this will include overseeing the continued development of the StarkNet network, fostering a community of users and developers, educating people about StarkNet and its technology, and helping developers gain the skill to maintain and build dApps on StarkNet as well as StarkNet infrastructure.
A seven-member board will govern the StarkNet Foundation, whose members come from diverse backgrounds and bring a multidisciplinary range of skills.
The board members are Andrew McLaughlin, Prof. Eli Ben-Sasson, Eric Wall, Heather Meeker, Prof Shubhangi Saraf, Tomasz Stanczak, and Uri Kolodny.
StarkNet Token
StarkNet token will be used for three purposes (payment, staking, governance):
1) Network payment - Paying network transaction fees. For a good user experience, users will also have the choice to pay in ETH.
2) Staking - Various services will require staking StarkNet tokens. As for reaching a temporary consensus on the validity of layer 2 transactions before L1 finality’s reached, data availability service, a permissionless Proof-of-Stake leader election mechanism, will be implemented for sequencing and proving STARK-compressed transactions.
3) Governance - Governance decisions regarding starknet operations and updates will be taken by token holders. A minimum voting threshold will be required to pass a governance proposal. Token holders will be able to vote directly or via delegation.
The StarkNet token’s design was made considering the needs of:
1. Users of the network.
2. Operators providing computing resources for various operations, such as sequencing transactions, STARK proof generation, and storage for data availability services.
3. Developers building and maintaining software for the infrastructure of the network and dApps built on top of it.
Starkware minted 10 billion tokens off-chain but, as of November 2022, has deployed the token contract on Ethereum. New tokens will be minted, so the circulating supply of tokens will increase over time. New minting of tokens and a portion of transaction fees paid by users will go to smart contract developers and core developers.
However, the StarkNet protocol may automatically distribute a portion of fees and new minting of tokens to smart contract developers according to the value their smart contracts provide to users. The exact mechanism for distribution has yet to be confirmed.
Initial allocation of StarkNet token
32% - Core contributors (Starkware employees and consultants and StarkNet software developer partners)
17% - StarkNet investors, such as Sequoia Capital, Tiger Global Management, Pantera Capital, IOSG ventures, etc.
50.1% of the token allocation for the StarkNet Foundation will be distributed as follows:
Community Provisions (9%)
To people who performed work for StarkNet and developed its underlying technology and infrastructure and to past StarkEx users. Allocations will be done based on verifiable usage of StarkEx’s technology before June 1, 2022.
To prevent gamification, snapshots from before the announcement date of the token rewards will be referred to distribute tokens, and additional network usage filtering will be done so that airdrop Sybil hunters don’t receive rewards.
Community Rebates (9%)
Rebates in StarkNet Tokens will be done to partially cover the costs of onboarding users to StarkNet from Ethereum. To prevent gamification, community rebates will apply to transactions after the rebate mechanism is announced by the StarkNet Foundation.
12% — Grants for research and work done to develop and maintain the StarkNet protocol.
10% — Strategic reserve will be distributed as ecosystem rewards for the activities that align with the foundation’s mission.
2% — Donations to highly regarded institutions and organizations, such as universities, NGOs, etc., will be decided by StarkNet token holders and the foundation through governance.
8.1% — Unallocated – Foundation’s unallocated treasury tokens will be distributed through governance for the purpose of supporting the StarkNet community.
Tokens allocated to core contributors and investors will be subjected to a four-year lock-up period with the linear release of tokens after a one-year cliff. The vesting schedule for tokens set aside for the StarkNet Foundation has yet to be announced.
