ZenIP 42409: ZenIP 42407 Addendum, Horizen 2.0 Tokenomics Proposal

There is a new ZenIP Proposal, ZenIP 42409, which is an Addendum to ZenIP 42407: Horizen Tokenomics Proposal. This ZenIP proposal has been in the community discussion phase since it went live on Discourse on April 1st, 2025.

The timeline for the vote on ZenIP 42409 is that voting will open on Monday, April 21st, 2025, at 12pm EST, and close on Thursday, April 24th, 2025, at 12pm EST.

Let’s review this ZenIP proposal below, and we’ll also remind you how to prepare your $ZEN to cast your vote.

Introduction

This ZENIP outlines a proposed addendum to the previously approved Horizen 2.0 tokenomics framework. With the recent decision to migrate Horizen to operate as an L3 appchain on Base, the ecosystem no longer requires a dedicated allocation to blockforging security. This provides an opportunity to reallocate the remaining 5M unminted $ZEN in a way that strategically drives long-term growth, ecosystem adoption, and sustainability and makes sense with being the first privacy platform of the Base ecosystem.

Note that the total supply will still remain the same at 21 million tokens.

The proposed allocations and their rationale are detailed below.

Recommended Allocation Summary

Vesting Schedule

At migration, 25% of the remaining token supply will be minted for the community, with the rest subject to a linear vesting period over 48 months. This structure is designed to promote prudent spending over time and to help stabilize ZEN’s value.

Category Explanations & Rationale

Incentives/Participation (750,000 ZEN | 15%)

Purpose: To establish a robust incentive pool that rewards participation, developer contributions, and strategic dApp deployments on Horizen.

Rationale: Incentives are crucial for onboarding high-impact projects and encouraging engagement within the Horizen ecosystem. Tying incentives to milestones such as project launches, TVL targets, or staking programs ensures that rewards flow to meaningful contributions rather than passive participation.

This allocation is also intended to revive successful elements of previous staking programs, ensuring ZEN holders have active opportunities to earn rewards through qualified staking opportunities.

Community Grants (250,000 ZEN | 5%)

Purpose: To provide direct funding for community-driven initiatives, development projects, and other grassroots activities that support Horizen’s growth.

Rationale: While grants are important for empowering developers and innovators, the reduced allocation reflects a shift toward aligning funding with more targeted investments through the ZEN Sustainability Initiative and milestone-based incentives. Prioritizing strategic funding ensures a higher return on investment and minimizes wasted resources.

Growth Marketing (250,000 ZEN | 5%)

Purpose: To increase awareness, promote Horizen adoption, and drive targeted marketing campaigns aligned with platform growth.

Rationale: By shifting emphasis away from traditional broad marketing, this allocation will focus on performance-driven campaigns that drive measurable outcomes such as TVL growth, developer recruitment, and dApp adoption. A more efficient marketing strategy will allow Horizen to capture attention while preserving capital.

ZEN Sustainability Initiative (2,000,000 ZEN | 40%)

Purpose: To establish a long-term sustainability reserve that ensures ongoing resources for Horizen’s ecosystem well into the future.

Rationale: The Sustainability Initiative is designed to support initiatives that generate long-term value for the ecosystem in a sustainable way. By strategically reserving resources and investing in ecosystem projects with revenue and equity share opportunities, Horizen can foster continued growth while building new revenue streams. This approach helps safeguard the ecosystem’s future, ensuring it remains dynamic and resilient as emission reserves diminish.

Ecosystem Development (750,000 ZEN | 6%)

Purpose: To fund technical infrastructure, tooling, and services that expand Horizen’s platform capabilities.

Rationale: With Horizen migrating to Base, much of the critical tooling and infrastructure needs will be provided by the Base ecosystem. This reduced allocation reflects a narrower focus on Horizen-specific tooling or enhancements that Base does not provide.

$ZEN Growth & Stability (500,000 ZEN | 10%)

Purpose: To maintain a strategic reserve that can be deployed to stabilize ZEN’s value, fund liquidity initiatives, and buffer market volatility.

Rationale: As Horizen evolves, maintaining stability in ZEN’s price will be crucial for maintaining investor confidence and user adoption. This fund ensures Horizen can mitigate extreme market shifts or support key initiatives during turbulent conditions.

Infrastructure (500,000 ZEN | 10%)

Purpose: Designated to support the security and maintenance of blockchain infrastructure, ensuring the long-term stability and functionality of the ecosystem. This may include, but is not limited to, funding for sequencers, RPC nodes, oracles, indexers, basic bridging support, possible DA layers, and other essential services. This provides flexibility to allocate resources toward initiatives that contribute to the ecosystem’s sustainability and growth.

Conclusion

This proposal reflects a strategic recalibration of Horizen’s tokenomics designed to optimize long-term sustainability, growth, and community impact. By reallocating the security budget into high-impact categories such as the ZEN Sustainability Initiative and Incentives/Participation, Horizen is better positioned to attract developers, expand the ecosystem, and ensure token value stability. Furthermore, ZEN’s utility will be integral to Horizen’s capability to enable private and compliant use cases within the ecosystem.

How much voting power do I have, and how can I prepare to cast my vote?

Your voting power is a sum of the following criteria:

• $ZEN in your EVM wallet (such as MetaMask).

• $ZEN in your linked mainchain wallet.

• The total amount of $ZEN that was delegated to forger nodes from your EON Wallet.

Please note that Horizen uses Snapshot for voting. This means that your voting power will be a total of the items above at a specific block height on EON. If token values change after that specified block height it will not be included in your voting power.

How do I link my mainchain wallet to my EON address?

Being that many users prefer to keep their $ZEN on Horizen’s mainchain we’ve made it possible to vote on proposals while keeping $ZEN on the mainchain. Please use the following guide to link your mainchain and EON addresses:

Linking Mainchain and EON $ZEN Addresses | Horizen Documentation

Do I have to do anything if I stake $ZEN to a forger node to vote on proposals?

No. As long as you are using the same wallet which was used to delegate stake, your voting power will include all $ZEN that is staked to forger nodes.

How do I vote on ZENIPs using my staked $ZEN?

Voting is done on Snapshot using Horizen EON.

1. Go to the Horizen Foundation Snapshot page:  https://snapshot.org/#/horizenfoundation.eth

   1. Make sure to join the Horizen Foundation as a member on Snapshot.

2. Connect your wallet.

3. Choose a proposal you would like to vote on.

4. Read through the proposal and look at the possible voting options.

5. Select a choice, you will be asked to sign a message with your wallet to vote on the proposal (this does not incur any gas fees).

As always, we remain available in the Horizen Discord for any questions or support needed!