GnosisDAO has approved a plan to wind down Gnosis Chain's standalone Layer 1 blockchain and turn it into a zero-knowledge-proven Ethereum Economic Zone rollup that settles directly to Ethereum every block. The decision, made under GIP-153, is a direction-level mandate rather than a final launch approval — no funding or complete technical design was greenlit. Still, it sets the project on a path that will free roughly 350,000 staked GNO, about 27% of the token's circulating supply, and force a fundamental rethink of how the token earns its keep.
The rollup pitch: one block, no bridges
Under the proposal, Gnosis Chain becomes an Ethereum Economic Zone (EEZ) rollup. The core idea is to give applications direct access to Ethereum's liquidity without forcing users to move assets across separate networks. Planned synchronous composability would let a Gnosis contract call an Ethereum contract and use the result in the same atomic transaction — no bridging step in between.
Martin Koeppelmann, Gnosis co-founder and CEO, framed it as a choice between two scaling philosophies. "Ethereum is not scaling into one economy; it's scaling into a hundred islands," he said. "This proposal is Gnosis choosing the other path. After the transition, anyone with a mainnet wallet will be able to use a Gnosis dapp in a single transaction, and a Gnosis account will be able to use anything on Ethereum. Same block, no bridges."
Several DeFi projects — Aave, Spark, Fluid, CoW Swap, Safe, Centrifuge, and others — have already committed to building consumer-focused products in the environment.
What happens to GNO's economics
Retiring the validator set removes the staking rewards that currently anchor GNO's value. Today Gnosis pays validator rewards from its treasury because network fees cover only a fraction of security costs. GIP-153 estimates this subsidy model dilutes non-stakers by about 2.3% annually.
Once staking disappears, the subsidy ends. The plan ties GNO to revenue generated by the rollup, but the exact mechanism is still unresolved. Options on the table include fee sharing or GNO buybacks linked to network revenue. For holders, that means swapping an established source of token utility for an unfinished revenue model — while simultaneously releasing a large block of staked tokens back into liquid markets. GNO rallied 10% to roughly $136 around the governance decision, its highest level since May.
A deliberate decentralization trade-off
The transition also comes with a governance compromise. Gnosis Ltd. is expected to operate the sequencer that initially orders transactions and produces blocks, while proofs and settlement move to Ethereum. GIP-153 explicitly describes this shift toward a less decentralized execution layer as a deliberate choice — a recognition that the rollup's security ultimately rests on Ethereum's settlement layer rather than on a standalone validator set.
The first EEZ version is targeted for around December 2026 or January 2027, depending on infrastructure readiness. That timeline is provisional; the approval doesn't fund the work or lock in the technical design. For GNO holders, the big open question is how the new revenue-sharing or buyback model will replace staking rewards — and whether that model can absorb the sudden liquidity from 350,000 unlocked tokens.
