As decentralized technology advances, the asset issuance and distribution landscape has reached new heights.

While Launchpad-based asset issuance models are viewed as compliance-focused benchmarks, they also face issues like high fully diluted valuations (FDVs) and low user engagement, leading to the emergence of new platforms like Pump.fun. These platforms aim to offer fairer and faster asset issuance alternatives. However, due to Pump.fun’s lack of project vetting, most projects on the platform carry a high risk of rug pulls, posing serious threats to investor funds.

ZAP addresses the core pain points of both models by providing an innovative solution that lowers the barriers for token issuance and offers users early access to projects. This aims to establish a truly inclusive ecosystem where all investors have equal participation opportunities.

ZAP Overview

ZAP is a community-driven token distribution protocol built on the Base and Blast networks. The team is dedicated to creating the simplest, safest, and fairest investment methods and has developed three core products: ZAP Labs, ZAP Launch, and ZAP Drops. These products provide tailored services for selected, meme, and airdrop projects, empowering project teams and investors while democratizing early-stage investments.

Source: ZAP

$ZAP is the core token of the ZAP ecosystem, issued on the Base network. Earlier this month, $ZAP was listed and made available for trading, and users can buy and trade it on exchanges like Gate.io. Additionally, the ZAP Vault is a cornerstone of the ZAP ecosystem, offering various benefits similar to those available to $ZAP holders.

ZAP Team Background and Funding

Founded in November 2023, the ZAP project operates with a distributed team, though further member details remain undisclosed.

In December 2023, ZAP completed a $900,000 seed funding round, with the project valued at $15 million. ZAP raised an additional $2.1 million this June through a private funding round. Notable investors in these rounds included Cypher Capital, Rarestone Capital, Sharding Capital, and renowned investors such as Luca Netz (Pudgy Penguins), Larry Cermak (The Block), and Chelse Jiang (Foresight Ventures).

In mid-July, ZAP announced that it raised $12.1 million through Vault sales. According to ZAP’s founder and CEO, Francis, if all vaults are sold out, the team will ultimately raise $50 million, bringing the project’s valuation to approximately $100 million.

Three Core Products

ZAP Labs, ZAP Launch, and ZAP Drops are the three main pillars of the ZAP ecosystem. Each addresses distinct issues in current asset issuance models. Together, they aim to provide users with new profit-making opportunities.

ZAP Labs

ZAP Labs offers a token issuance channel for projects in the development phase, typically those backed by VC funding. It provides projects with various benefits, such as dedicated account managers, strategic consulting, ecosystem partnerships, resource support, additional financial incentives, and post-launch support.

The ZAP team categorizes token issuance platforms in the market into four types, each with its own challenges:

1) Closed platforms requiring platform tokens for participation: While these offer significant potential returns for investors holding platform tokens, the capital requirements are high, and participation is undemocratic;
2) Lottery-based distribution platforms: Though relatively fair, the low odds of winning lead to investor fatigue and inefficient capital distribution;
3) Permissionless issuance platforms: These lack security guarantees for investors and often fail to provide essential tools and support for project teams;
4) Airdrop-based issuance platforms: These have a risk of internal manipulation.

ZAP Labs presents a new solution for these pain points. On the one hand, the team reviews projects to ensure user asset security. On the other hand, users can contribute to ZAP Labs project funding by following social media accounts, participating in testnet activities, building community, and engaging in discussions.

Notably, all token issuances on ZAP Labs allow for oversubscription, taking into account:

• Token demand assessment provides some insight for future financing strategies and holding behaviors;
• Compared to common “first-come, first-served” participation methods, oversubscription offers investors a fairer participation model, reducing advantages based on time zones and technical advantages.

If funding for a ZAP Labs project exceeds the cap, all investors will be equally diluted by the same percentage and the remaining amount will be immediately refunded.

ZAP Launch

ZAP Launch primarily targets projects in the meme coin category. Users can create and launch a project token within a minute for just a few dollars, even without providing liquidity.

Source: ZAP

Tokens operate on a bonding curve, with prices adjusting as circulation increases. Users can buy and sell at any time. Once the market cap reaches 5 ETH, the project’s liquidity and remaining tokens will transfer to a DEX for public trading.

All projects under ZAP Launch use audited, secure smart contracts and are issued with a uniform supply (1 billion tokens) and liquidity (200 million tokens) to ensure fairness and transparency.

The ZAP team believes that current meme coin platforms generally offer a poor user experience, lacking a seamless interface for crypto newcomers. ZAP addresses these issues by simplifying the token customization process and enhancing the user experience through better marketing and community-building support.

ZAP Drops

ZAP Drops serves airdrop projects. Project teams can set on-chain and off-chain tasks on this platform, allowing users to complete them through gamified experiences and receive rewards.

To ensure genuine user engagement, ZAP Drops implements anti-bot and anti-fraud measures. It also provides a user dashboard, helping participants easily claim their airdrops. This enhances the user experience and reduces airdrop transaction costs for project teams.

For both project teams and users, ZAP Drops seeks to offer a simpler, smoother experience that captures the appeal of Web3.

ZAP Economic Incentive Model

$ZAP is the core token of the ZAP ecosystem. It has a total supply of 350,000,000 tokens, and trading began on major platforms earlier this month.

According to the official $ZAP token distribution model, the allocation breakdown is as follows:

Source: ZAP

• Community Treasury (25%): Mainly used to incentivize $ZAP stakers, holders, and users by providing APY rewards, trading competitions, airdrops, and other rewards. 1% of the total $ZAP supply will be airdropped to platform users in appreciation of their support for the testnet.
• Vault Sales (20%): Users holding ZAP Vault have exclusive privileges, such as higher APY returns, special Discord roles, early access to private sales, etc. 20% of the total $ZAP supply is reserved solely for Vault holders.
• Team and Contributors (25%): All team tokens will be liquidated through professional market-making partners as needed.
• Strategic Investors (15%): Allocated to institutional investors and angel investors from the seed and strategic rounds.
• IDO (1%): A small IDO will be conducted as part of ZAP’s listing on Bybit.
• Liquidity and Market-Making (9%): Primarily supports CEX and DEX activities, aiming to provide a healthy, liquid on-chain and off-chain trading environment for the ZAP token.
• Advisors (5%): All advisor tokens will be liquidated through professional market-making partners.

To encourage on-chain activity among $ZAP holders, an official staking program has been launched, offering multiple benefits to participants:

1) Staking Rewards
$ZAP staking generates passive income for users. Rewards increase as the amount of staked tokens grows. These rewards, sourced from the community treasury, are distributed monthly over four years.

2) External Protocol Rewards
Rewards are generated through ZAP ecosystem activities and collaborations with other ecosystem partners. For example, staking users can participate in projects under ZAP LABS.

3) Memecoin Airdrop Rights
In addition to ZAP Labs projects, stakers also get a share of each memecoin launched on ZAP, receiving a small portion (e.g., 1-2%) based on milestones like time or market cap.

4) Exclusive Staking Tasks on ZAP Drops
While ZAP Drops is open to all Web3 users, offering project exploration and profit opportunities, only $ZAP stakers can access exclusive tasks and rewards.

5) XP Multiplier Rewards
When stakers complete tasks on ZAP Drops, they receive multiplied XP rewards on the platform.

6) Discounted Purchase Opportunities
$ZAP stakers are eligible to purchase products at discounted public sale prices.

7) Protection Against Dilution
Project token sales on the ZAP platform may become oversubscribed, diluting purchased token shares. Staking $ZAP ensures that stakers’ token shares are protected from dilution.

Alongside these applications, a deflationary burn mechanism enhances $ZAP’s value. Token holders who burn $ZAP receive exclusive benefits like skins, NFTs, and Discord roles.

In addition to the ecosystem token $ZAP, the ZAP Vault plays a crucial role within the ecosystem. Limited to 30,000 units, the Vault was issued on the Blast network and went on sale on March 28. The first 10,000 were priced uniformly at 1,000 USDB. After the sale of 10,000 Vaults, prices increased incrementally.

Source: ZAP

However, as per ZAP’s latest announcement, Vault sales have now been permanently closed to protect the interests of current holders.

Vault Holder Benefits Include:

• Daily ZAP rewards
• Multiplier staking rewards
• Exclusive NFT binding for potential benefits
• Random blind box NFT drops (with Pudgy Penguin NFT confirmed as the first airdrop reward)
• 10% of CTZN NFTs will be airdropped to Vault stakers
• Exclusive ZAP benefits, early access to new features, and regular task completion rewards

Currently, $ZAP and Vault holders can stake on the official website, with staking terms of 3, 6, and 12 months. The longer the staking period, the higher the APY and reward multipliers.

Source: ZAP

ZAP Ecosystem Development and Challenges

As an asset issuance platform, ZAP serves as a bridge between emerging projects and the user community. With more quality projects launching on the platform, ZAP has the potential to become a top choice for crypto users if it can consistently deliver returns, providing ample room for growth.

However, during the TGE event in mid-month, significant errors in token claiming and staking led to community-wide panic, resulting in $ZAP token sell-offs and a sharp price drop. The team promptly addressed these issues, released corrections, and announced the ZAP Recovery Plan to restore community confidence and engagement.

Under this plan, the team adjusted previous plans and details, including increasing daily rewards for Vault holders, boosting staking APY, delaying the ZAP community airdrop, enhancing the airdrop rewards for ZAP Labs’ first incubated project, FLEXX, and initiating a $ZAP buyback program.

Additionally, the team revealed upcoming product and market roadmap updates, including an outline of ZAP’s Web2 strategy and support for social media account registrations.

Conclusion

With its three core products—ZAP Labs, ZAP Launch, and ZAP Drops—ZAP aims to provide Web3 users with a more comprehensive and user-friendly asset issuance platform. This platform reaches a broader audience and enables users to participate equally in early-stage project development and funding, offering potential reward returns.

As the cornerstone of the entire ZAP ecosystem, the value of $ZAP and the Vault is set to rise along with its real-world applications, community growth, and market demand, supporting the ecosystem’s long-term positive development. However, the immediate priority for the ZAP team is to effectively manage the “aftershocks” following issues during the TGE, helping the community regain confidence in the project’s development trajectory.