Linea, the Ethereum Layer 2 (L2) founded by Consensys, introduced a set of mechanisms and long-term commitments designed to establish the network as the home for ETH capital. These mechanisms include native yield on bridged ETH, protocol-level ETH burn, a deflationary, Ethereum-centric token design, and the formation of the largest Ethereum ecosystem fund. An unprecedented 85% of the token supply will go to the ecosystem, with 10% allocated to early users and the remaining 75% to be distributed through the ecosystem fund in a series of programs over time. The remaining 15% will be allocated to the Consensys treasury under a 5 year lockup.
Ethereum-Aligned Consortium to Manage the Largest Ethereum Ecosystem Fund
Ethereum’s largest ecosystem fund by allocation will be managed by a group of credible Ethereum institutions organized as the Linea Consortium. Alongside Consensys, initial members will include Eigen Labs, ENS Labs, SharpLink, and Status, with other participants to be announced later. The Consortium will bootstrap and drive development of next-generation applications and technology for at least the next ten years, marking Ethereum’s 10th anniversary with a commitment to build out the future token economy. Consortium members will be responsible for selecting, and in some cases designing and managing programs that will direct resources to users, builders, liquidity providers, Ethereum public goods, and R&D efforts, ensuring long-term investment in growth and innovation aligned with Ethereum’s mission and values.
These commitments build on momentum with institutional actors, position Ethereum to meet the needs of sophisticated capital as TradFi begins to onboard to DeFI, and reinforce Linea as a major home of future innovations in onchain capital markets, staking, and infrastructure
ETH Staking and Fee Burn to Power the Next Generation of Capital-Efficient DeFi
Expected by October 2025, Linea’s native bridge will allow for ETH deposits to be staked on Ethereum mainnet, enabling liquidity providers to accumulate Ethereum staking rewards in addition to returns from their Linea DeFi activity. This ETH-native staking model will unlock productive yield on bridged assets, fueling DeFi innovation and transforming ETH from passive collateral into an active component of a capital-efficient L2 ecosystem. The new technology is designed to meet institutional safety standards, and will also enable fast withdrawals.
In addition, 20% of all net transaction fees at the protocol level, which will be paid in ETH, will be burned, directly reducing ETH supply and fortifying Ethereum’s deflationary economics. This marks the first time an L2 has made a commitment to burn ETH, and will ensure that every Linea transaction contributes directly to Ethereum Layer 1 value accrual. The remaining 80% of net transaction fees will be used to burn LINEA tokens, making the LINEA token, which has a fixed supply, deflationary in proportion to network activity.
“We are witnessing an architectural reset in global finance, where credibly neutral, decentralized, programmable infrastructure becomes table stakes for how value, identity, and coordination function across borders and institutions. Ethereum is emerging as the trust foundation for this new economic architecture. Linea is the only L2 with total Ethereum compatibility, and we wanted the economics to be as aligned and supportive as the technology. We’re building for the long term, we’re creating infrastructure that institutions can trust and easily work with, and that the extended Ethereum community can own,” said Joseph Lubin, Founder/CEO of Consensys, Co-founder of Ethereum and Chairman of SharpLink.
An Unprecedented Distribution for Long-Term Ethereum Alignment
While Ethereum has scaled thanks to the efforts of its many L2 platforms, each solution takes a slightly different approach, some experimenting with modified EVMs, non-ETH gas tokens, novel governance bodies, or native tokens with varying degrees of utility. Linea is designed to closely mirror Ethereum, offering a seamless entry point for developers through full EVM equivalence and a forthcoming token that echoes Ethereum’s genesis split while respecting and leveraging the fundamental strength and utility of ETH. In addition to its ecosystem and builder-forward token allocation, the Linea token is designed to promote Ethereum alignment and help set new standards for other projects.
“We’ve taken the time to listen to the community and design an approach that leans into our unique strengths and reflects Ethereum’s core principles. We wanted to serve as an example for the way Layer 2s are built and brought to market, and do it in a way that directly contributes to the strength and success of Ethereum and ETH. Linea Mainnet will burn ETH with every transaction, use the LINEA token to support users, builders, and public goods, and return value to Ethereum’s base layer, all while growing long-term value in the LINEA token-based economy. Linea is a major gateway to, and natural extension of, Ethereum, and together we’re going to help drive Ethereum to become the base layer of the future global economy,” said Declan Fox, Head of Linea.
As Ethereum cements its role as the global settlement layer for programmable money, with over $100B in ETH staked and $25 trillion in transaction volume in 2024, these initiatives reinforce Linea’s position as Ethereum’s most aligned L2 technology.
Joseph Chalom, Co-CEO of SharpLink: “Institutions value platform stability and are always building for the long-term. Linea’s commitment to Ethereum couldn’t be more clear, and we think the platform’s unique alignment with Ethereum will make it an important part of its future. We couldn’t be more excited to join with fellow ecosystem stewards to advance the development of new programs that will make that happen.”
Sreeram Kannan, Founder and CEO of Eigen Labs: “Linea will be a force multiplier for the scale and utility of Ethereum, and Eigen’s role as a steward for the network will help us continue our work as an ETH accelerator alongside the Linea team. In this position, we’ll provide access and hands-on support for Linea developers to build cloud-scale applications on EigenCloud. Fully verifiable, slashable cloud services like EigenDA enable Linea to power new workloads, like onchain AI. Together, we will dramatically expand the productivity of ETH as an asset that secures, funds, and fuels the next generation of human coordination.”
Nick Johnson, Founder and lead developer of ENS: “ENS Labs is proud to serve as a founding steward of the Linea Consortium. As we prepare to launch Namechain on Linea, it’s critical that the underlying L2 remain credibly neutral and Ethereum-aligned, and we’re committed to helping steward a values-driven roadmap for such an important piece of Ethereum infrastructure. We look forward to working alongside the Consortium to ensure Linea grows in a way that serves the broader Ethereum ecosystem.”
Cyprien Grau, Lead at Status Network: “Linea is setting the blueprint for how to build Ethereum-aligned L2s. At Status, we’re proud to contribute to the Linea codebase, a rollup stack that enshrines ETH alignment in code, economics, and governance. We’re implementing that blueprint with Status Network, the first natively gasless L2 built on Linea: deep ETH alignment via native yield to enable free transactions at scale, and SNT burn mechanics that tie our token to ecosystem growth.”