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Status Network has introduced an innovative Ethereum Layer 2 solution that eliminates gas fees while creating sustainable funding mechanisms for community projects. The platform's unique economic model was detailed in a recent AMA session with project lead cyp.
The network implements a rate-limiting system that provides users with free transaction quotas, resetting periodically to prevent spam. "Regular users won't pay anything," cyp explained, noting this approach avoids reliance on volatile gas fee revenues that plague other chains.
【Key Innovation】The system funds operations through yield generated from user deposits. At 【$100-200 million TVL】, the network becomes self-sustaining, with surplus distributed as 70% community rewards and 30% operational costs.
Native applications like DEXs and stablecoin platforms contribute 30% of fees back to the network. ——This creates a flywheel effect where ecosystem growth directly benefits users——, according to cyp. The model particularly targets gaming and social applications, eliminating onboarding barriers through gasless transactions.
Status Network introduces "Karma" - a non-transferable token earned through network participation. Holders can vote on allocating public funds, with streams automatically adjusting based on project milestones. "It's real value distribution, not just governance tokens," emphasized cyp.
The system combats whale dominance by requiring diversified participation: staking utility tokens, providing liquidity, and active app usage. Karma also serves as an onchain credit score, potentially enabling undercollateralized loans for high-scoring users.
Currently collaborating with Linea on core infrastructure, Status Network plans a TVL pre-deposit campaign in October 2025 ahead of Q1 2026 mainnet launch. The protocol aims to support grassroots developers while maintaining anti-abuse measures through epoch-based funding cycles.
——We're building an L2 where anyone can contribute and benefit—— cyp concluded, positioning the network as an alternative to VC-dominated funding models. As of press time, the team is finalizing integrations with multiple data availability solutions to support the gasless architecture.