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ZTC Tokenomics

ZenChain transactions are designed to be cost-effective, with network fees paid in ZTC, the native currency. ZTC is central to ZenChain’s consensus mechanism, where staking helps secure the network and earns rewards for participants. You can bridge your ZTC from Ethereum to ZenChain for an enhanced crypto experience.

No Inflation​

ZTC, ZenChain's native currency, is designed to be inflation-resistant. Similar to Bitcoin, ZTC has a fixed supply cap of 21 billion units. During standard blockchain operations, new ZTC is neither created (minted) nor destroyed (burned).

Instead, ZenChain uses a treasury reserve system. ZTC enters circulation when paid out from this treasury, such as for consensus staking rewards. Conversely, when ZTC is "burned"—for example, when users pay network transaction fees—it is not destroyed. Burned currency is transferred back to the treasury reserve, removing it from active circulation and helping to maintain a stable treasury balance.

The economics of ZenChain are designed so that that treasury balance will remain positive indefinitely. The total supply of ZTC can only change in the highly improbable scenario where the treasury reserve is depleted, and new ZTC must be minted to ensure continued network operations.

Dynamic Incentives​

ZenChain uses a dynamic reward system for staking ZTC. The Annual Percentage Yield (APY) you earn isn't fixed; it adjusts based on the total amount of ZTC currently being staked across the network.

Here’s how it works:

  • When less ZTC is staked: The APY is higher. This encourages more currency holders to stake their ZTC.
  • When more ZTC is staked: The APY gradually decreases.

This adjustment process continues until the APY stabilizes around a predetermined 'target APY'. The primary goal of this system is to encourage users to stake their ZTC, ideally helping the network reach a 'target stake ratio' (a desired percentage of the total ZTC supply being staked). This ensures that staking remains an attractive option with competitive rewards at various levels of network participation, effectively balancing network security needs with staker incentives.