29-7-2025 – ConsenSys-developed layer-2 network Linea will become one of the first Ethereum scaling solutions to burn ETH as part of its tokenomics design, the company announced while revealing details of its upcoming token generation event planned for later this year.

The network will dedicate 20% of all transaction fees to burning Ethereum, with the remaining 80% used to burn its native LINEA tokens, creating deflationary pressure on both assets. This mechanism addresses growing concerns that layer-2 networks have been diverting fee revenue away from Ethereum mainnet while benefiting from its security infrastructure.

Linea’s token launch will distribute 85% of supply to the ecosystem, with ConsenSys retaining 15% under a five-year lockup period. The network plans to introduce a staking mechanism in October that allows users to earn rewards on bridged ETH while simultaneously using those funds for DeFi activities on the layer-2 platform.

“Linea is the only L2 with total Ethereum compatibility, and we wanted the economics to be as aligned and supportive as the technology,” said ConsenSys CEO Joseph Lubin. The company hopes these features will establish Linea as the “home for ETH capital” by offering enhanced yield opportunities for liquidity providers.

Despite ambitious plans, Linea currently holds just 1.23% of the rollup-based layer-2 market with approximately $513 million in total value locked, according to L2Beat data. The network faces intense competition from established players like Arbitrum and Optimism, which dominate layer-2 market share.

ConsenSys has formed an Ethereum-aligned consortium including Eigen Labs, ENS Labs, Status, and Lubin’s gaming firm SharpLink to manage ecosystem development funds. The consortium aims to leverage ConsenSys’s MetaMask distribution network to attract users and developers to the platform.