Understanding the $PROVE Token’s Economic Flywheel: An ELI5 Explanation
Imagine the Succinct Prover Network as a bustling online marketplace where “proofs” mathematical certificates verifying computations without revealing details are traded using the $PROVE token. Powered by the SP1 zkVM, which is 10 times faster than competitors, it simplifies zero-knowledge (ZK) proof creation for blockchain applications like Ethereum L1/L2s and Bitcoin/Solana rollups.
This establishes a proving economy where developers pay in $PROVE, GPU operators compete to generate proofs, and stakers earn fees that grow with transaction volume from thousands to billions.
The flywheel, a self-reinforcing cycle, operates as follows:
• More transactions boost demand and generate higher fees in $PROVE.
• Provers must stake $PROVE to participate, locking up supply.
• Increased revenue raises staking yields, attracting more stakers.
• Growing adoption brings more apps, looping back to higher demand.
For instance, Layer 2 networks like Arbitrum and Optimism handle 12 million daily transactions, potentially yielding $43.8 million annually for Succinct, with additional volume from DEXs and bridges.
Adoption accelerates this cycle through institutional and enterprise support driving volume through:
• Enterprise integrations with millions of users and billions of proofs.
• Regulatory compliance needs making ZK essential.
• Predictable B2B revenue from high-volume contracts.
• Network effects from tech giant adoptions like Google.
The time for $PROVE’s flywheel is now
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