The community around zero-knowledge roll-up Scroll is up in arms about the protocol’s plan to distribute 5.5% of its new SCR Token to the Binance Launchpool, a move that critics say favors large investors on Binance, the world’s largest crypto exchange.
It’s “crazy 5.5% of the total supply goes to Binance whales for just 2 days of farming,” @defiignas, a prominent DeFi researcher, posted on Tuesday morning.
“Imagine farming scroll more than 1 years ++ [and being front-run] by some whale on Binance,” wrote @gmaazs, the community managers account for Airdrop Finder, an X-based airdrop locator.
According to a blog post published by Scroll early Tuesday, 35% of the one billion token supply of SCR will be dedicated to ecosystem and growth, 23% to Scroll contributors, 17% to investors, 15% to airdrops and 10% to the Scroll Foundation. Of that 35% allocated for ecosystem and growth, 5.5% is being reserved for Binance’s Launchpool and Pre-Market at SCR’s launch, “with the aim of broadening Scroll’s reach to users globally, including those who have untapped potential for more on-chain interactions,” Scroll wrote.
The protocol noted that many users in countries with growing economies rely on Binance’s peer-to peer services, and so “by collaborating with Binance, we are value-aligned to support the global community, particularly in the global south, by offering more accessible on-off ramp solutions,” Scroll explained in its post.
In its own blog post on Tuesday, Binance said it would be the first platform to list SCR, with pre-market trading going live Friday, October 11 at 6 a.m. ET. However, the token will be added to the Binance Launchpool more than two days earlier, on Tuesday, October 8 at 7 p.m. ET. Critics argue that this gives Binance whales an unfair head-start, allowing them to pump the token price before dumping it ahead of the token generation event.
Community members also criticized the way that Scroll is dividing up its airdrop distributions to the community.
Of the 15% that Scroll said it is allocating to airdrops, only 7% will be distributed this week. The remaining 8%, its blog post said, will be distributed at an undefined “future” date. “I’ll be annoyed if Scroll gives less than 15% to [the] community,” @defiignas wrote in their post.
When contacted by Unchained about the criticism, Scroll’s head of communications, Ryan Dennis, reiterated that working with Binance helps ensure that Scroll is available in developing countries. “We’ve designed Scroll to be a chain for the people—user-friendly and easy to navigate, ensuring a smooth experience for all. Our collaboration with global exchanges is key to this mission,” Dennis wrote.
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Scroll is a ZK roll-up designed to help developers build on the Ethereum Virtual Machine. Scroll’s blog states that its SCR token will be used for governance and later become a utility token as the protocol becomes more decentralized. This decentralization will occur as part of a three-step process, first by distributing power to the community via the Scroll DAO; second, by incentivizing external parties to run and optimize provers; and third by incentivizing sequencers to provide finality guarantees.
