A new bridged token from the cross-chain protocol LayerZero has sparked criticism within the Ethereum ecosystem. Launched on October 25, the Wrapped Staked Ether (wstETH) token quickly became the center of attention, drawing the ire of nine prominent protocols. Connext, Chainsafe, Sygma, LiFi, Socket, Hashi, Across, Celer, and Router jointly criticized the protocol’s new token, raising concerns about its proprietary nature and the potential risks to the wider projects involved.

Controversy Unveiled: The Vendor-Locked Standard

The joint statement released on October 27 accused LayerZero of introducing “a vendor-locked proprietary standard,” which limits the freedom of token issuers. According to the protocols, wstETH, a representation of staked Ether (stETH) on Avalanche, BNB Chain, and Scroll lacks support from the Lido DAO, a decentralized autonomous organization. The critics argue that this approach, rooted in provider-specific systems controlled by the implementing bridges, creates substantial systemic risks that are challenging to quantify. They advocated for adopting the xERC-20 token standard for bridging stETH, emphasizing the need for open, standardized protocols.

Read more: LayerZero: No Airdrop Rumors Amidst Google Cloud Partnership

LayerZero Responds and the Future Implications

Source: Bankless

LayerZero, in response to the allegations, defended the wstETH token’s protocol as secure and decentralized. The protocol highlighted the omnichain fungible-token (OFT) standard, a multiaudited, open-source set of reference contracts used by over 75 projects. According to the protocol, developers retain the ability to select their validation layer permissionlessly and include other bridges within the immutable LayerZero framework. However, skepticism persists within the Ethereum community, with concerns ranging from the token’s security to potential centralization risks.

Read more: LayerZero Set to Deploy $ZRO on Aptos as Gitbook Gets Updated


The controversy surrounding LayerZero’s wstETH token has illuminated significant debates within the Ethereum ecosystem. As the community grapples with questions of standardization, decentralization, and security, it remains to be seen how this conflict will shape the future of cross-chain functionality in the rapidly evolving Web3 landscape. Stay tuned for further developments as the Ethereum community navigates these uncharted waters, seeking a resolution that aligns with the principles of decentralization and collaborative innovation.

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