[Proposal] Incentivizing the Growth Phase of Starknet

Right on. Notice that Rebates (9%) are allocated towards onboarding from Ethereum onto Starknet. Additionally, regarding ongoing flow of tokens to those working to maintain and improve the system, recall this quote from the 3rd blog:

Developers build and maintain the software used by Operators to secure the network, and they create apps that enhance the network’s functionality for users. Consequently, a portion of the fees and new minting will go to Smart Contract Developers and Core Developers, as follows:

  • Smart Contract Developers: the StarkNet protocol can automatically measure the value provided by smart contracts, via the L1 and L2 fees paid by Users of these contracts. The StarkNet protocol will automatically allocate a fraction of fees and ongoing new minting to Smart Contract Developers. Smart contracts that offer more value to Users — measured by fees paid for them — will receive a larger portion of tokens allocated for this purpose.
  • Core Developers: The StarkNet protocol has no automatic way of quantifying the contribution of Core Developers, such as those writing code for provers, sequencers, full nodes, etc. Consequently, token allocation to such Core Developers and other contributors whose contribution is not measurable by the protocol necessarily requires some human discretion. A model will be established for applying this in a manner that is consistent with the goal of decentralization.
  • The exact mechanism for allocating tokens from new minting and fees to both types of Developers is yet to be determined. The design principles will include anti-gamification and transparency.

Creating and sharing an open-sourced method for sybil-detection that should be used by Starknet and all projects that receive $STRK tokens from the selection committee for community distribution. This would allow a top-level filter for any known and identified farmers. The criteria for such an exclusion list would need to be ratified.


I won’t recommend Starknet to apporach like other projects like optimism else it will become next optimism. Fund distribution is way too much restricted in such projects.

I think Starknet is pretty distinct from other L2s. The steeper learning curve is felt. Making consumers feel at ease using Stark and its unique wallets would be a major achievement. People will seek for simpler options if they feel it is difficult to use. Having said that (and this is where I show my bias), there are several locations where people can pay. If sticky liqudiity is indeed lacking in this area, which is crucial, where should we go elsewhere and how can we entice them to Starknet?

The programming language is another potential problem. So many L2s are, in some way, copies of others.


Public goods funding model from Optimism is a pretty interesting model to learn from.

But Starknet has the opportunity to experiment with a more unique governance committee selection.


these are the key things to encourage through something ideally more flexible than a grant program which is a very binary one project/one vote type of thingree this


Hi David, I agree with your point that incentive programs are a good thing. As you mentioned, whether it’s Optimism or Avalanche, incentive programs on the chain have led to significant increases in TVL and user numbers. However, I have a suggestion that Starknet should take more aggressive incentive measures in the early stages. Currently, L2 competition is intense, and users are accustomed to operating on metamask and EVM-compatible chains. To attract users and liquidity, it is necessary to attract sufficient attention. After the number of users and liquidity increase, we can change to a strategy that increases user stickiness and sustainable development. These are my thoughts as an ordinary user.


I am very glad that StarkNet has started to discuss the community incentive plan in the community. As a StarkNet user, what I am most concerned about is what kind of incentives users can get? You know, without users, you are nothing. I think users are the most important thing.


TVL on Starkent is pretty low, granted it’s still in its early phases;


1 Scalability: As with many blockchain platforms, scalability remains a challenge for StarkNet. Improving scalability will help the platform handle more transactions and improve its overall efficiency.

2 User experience: While StarkNet is designed for developers, improving the platform’s user experience can help attract more developers and make it easier for them to use the platform.

3 Documentation and resources: More comprehensive documentation and resources can help developers learn how to use StarkNet more easily and efficiently, and help them solve any issues they encounter during development.

4 Governance and community involvement: Improving governance and community involvement can help ensure that StarkNet is aligned with the needs and priorities of its users and stakeholders, and can help build a more vibrant and engaged community.

5 Security and auditing: Strengthening the security and auditing of StarkNet can help prevent potential security breaches and improve trust in the platform.

Overall, by addressing these areas of improvement, StarkNet can become a more robust and user-friendly blockchain platform that is better suited for a wide range of use cases and can attract a larger community of developers and users.

Regenerate response


This is interesting. I’d love to see how the proposal favours the community as a whole, and not just the people at the “top of the chain”


starknet is still in its early days, so it needs to develop as quickly as possible.
First, reduce gas rates, which are still too high and limit access for many people.
And then add incentives and add liquidity and you increase TVL, and in the current dapp, there’s too much slip point loss. It limits the use of stark for many people


Insanely good thread. thanks for sharing all the info. I truly think airdrops or “lockdrops” are the best way to start since it atracts so many people to the chain or dApp in your case. you get natural exposure to the real market and you get to test much better than 100 employees ever could. very interesting insights you added.


I don’t think the token agenda should be raised prematurely, or there is an option to innovate the dual token model, first release some low-value tokens to incentivize, improve the application scenario, and finally improve competitiveness when the TVL is high, and combine token distribution with TVL


Thanks for the response, Eli! Feels great to see the board engage with the debate and share their rationale, transparency matters so much.

Are L1 and L2 fees the only metric that should be taken into account though? Agreed that anti-gamification is key, but I like the idea of accounting for new users brought over to the ecosystem! It’s significantly harder to attract a new user than it is to attract an existing one, and represents a much better outcome for Starknet as a whole.

There’s also the issue that a system like this adds a strange incentive to developers to avoid gas cost optimization, which is probably not that big but still significant.

I think there is value in discussing that mechanism in more detail as it represents possibly one of the coolest ways I’ve ever heard of to properly incentivize builders to build useful applications and offers a business model to crypto startups that are notoriously bad at finding one.

100% agree with you that it’s very hard to properly quantify core developers’ work and impact and human discretion is required in properly rewarding it.


Starknet still needs to be optimized because of the delay due to the lag in the network caused by people flocking to the project, and issuing coins early is detrimental to the project.

1 Like

@NathanVDH Very true. Well planned hackerthon series, strong and committed MM partner are quite important besides the grant project.


wholeheartedly agree with you @AoH… having said this, I want to express support for @david proposal for the Starknet Governance Fund. The initiative can prove essential in accelerating Starknet’s growth, onboarding new developers and increasing user engagement as Starknet improves.


Afaik this was discussed and battle tested on Canto blockchain where devs are by design incentivized to make more gas consuming code (tp get more rebates). In the end the competition between protocols and UX is supposed to mitigate it as end-user will choose less gas consuming app.

Thanks for sharing your rational when it comes to creating incentives to developers based on fees.

With this type of incentives I’ve heard many people say that engineers might create contracts that consume a lot of gas with the hope of getting more for themselves. Others say that someone else will notice and might optimize it and that the market will go to the place with less fees.

I don’t believe those are facts, I believe there is a lot of speculation in those “truths” as I’ve seen products charging fees and products with 0 fees and in many cases the one with fees is the dominant one.

Until now it’s been clear that the mayor driver for TLV across L2s has been incentives and speculation and I understand why the main focus for the incentives are developers. But one thing that is important to keep in mind is that capital is mercenary, once there is a new thing providing more rewards they will abandon the technology with no mercy.

I believe that educating, onboarding new talent and cultivating culture in the Starknet Ecosystem should be other aspects that the foundation considers to incentivize.

I’m at the same time super excited to read more about the mechanics for sustainable and fair distribution to builders in the ecosystem as this will help a lot teams decide to move into the starknet ecosystem.

1 Like

All I know is that we should not hurry! Thus, we can build a much more healthy platform for everyone

1 Like