Ethereum’s Layer 2 ecosystem is set for a major upgrade as ConsenSys’ Linea unveils a groundbreaking dual token burn mechanism and native ETH staking. This innovative approach aims to drive Ethereum deflation while enhancing scalability and economic alignment between Layer 1 and Layer 2 solutions.
How Linea’s Dual Token Burn Works
Linea becomes the first L2 solution to implement a dual burn model, creating deflationary pressure on both Ethereum and its native LINEA token. Here’s how it works:
- 20% of ETH transaction fees on Linea are burned at the protocol level
- 80% are converted to LINEA tokens for secondary burning
- This reduces Ethereum’s circulating supply while aligning L1 and L2 economics
Native ETH Staking Coming to Linea
Starting October 2025, users can stake ETH directly on Linea while enjoying L2 benefits:
| Feature | Benefit |
|---|---|
| Mainnet rewards | Earn staking yields while using L2 |
| L2 liquidity | Maintain access to fast, cheap transactions |
| Reinvestment | Rewards fund ecosystem development |
Ethereum Ecosystem Growth Through Consortium
Linea has formed a powerful consortium including Eigen Labs and ENS Labs to oversee:
- A dedicated 10-year Ethereum ecosystem fund
- Application development support
- Research initiatives
What This Means for Ethereum Deflation
Linea’s approach introduces novel deflationary dynamics to Ethereum’s tokenomics:
- Direct ETH supply reduction through L2 activity
- Stronger economic ties between L1 and L2
- Potential to influence broader Ethereum valuation
LINEA Token Distribution Plan
While launch timing remains unconfirmed, the distribution strategy is clear:
- 10% airdropped to early adopters
- 75% managed by consortium fund
- 15% reserved in ConsenSys treasury (locked for 5 years)
This strategic shift in Ethereum scaling prioritizes economic alignment between layers while introducing innovative deflationary mechanisms. Success will depend on sustained user adoption and capital inflows, but the potential to reshape Ethereum’s tokenomics is undeniable.
Frequently Asked Questions
When will native ETH staking launch on Linea?
The feature is scheduled for October 2025, allowing users to stake ETH while using L2 capabilities.
How does the dual burn mechanism benefit Ethereum?
It directly reduces ETH supply through L2 transactions while creating deflationary pressure on LINEA tokens.
Who is part of the Linea consortium?
Key members include Eigen Labs, ENS Labs, and SharpLink Gaming, among others.
What percentage of Linea’s fees are burned?
20% of ETH fees are burned directly, with 80% converted to LINEA for secondary burning.
How much TVL does Linea currently have?
As of July 2025, Linea has over $515 million in Total Value Locked.
