CELO
Celo
$0.07059
6.16%
Celo
CELO
$0.07059
6.16%
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Celo Information
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About Celo
Celo is a blockchain platform designed for global financial inclusion, initially launched as a Layer 1 (L1) blockchain but transitioning to an Ethereum Layer 2 (L2) using the Optimism OP Stack. This shift enhances scalability, security, and interoperability while maintaining Celo’s mobile-first approach. The platform uses a centralised sequencer, reducing validator roles while keeping staking rewards and governance participation. CELO, the native utility and governance token, functions both as a native asset and an ERC-20 token, enabling gas fee payments, staking, and cross-chain transfers. CELO supports fee abstraction, allowing gas fees to be paid with assets like cUSD and USDC. The project, developed by cLabs and supported by the Celo Foundation, focuses on financial accessibility. The Celo Governance Proposal (CGP-133) initiated the L2 migration, aligning Celo with Ethereum’s security while preserving its original financial inclusion mission.
Celo is a blockchain platform focused on enhancing financial inclusion by enabling fast, low-cost mobile payments and decentralised financial applications (DeFi). Originally launched as a Layer 1 (L1) blockchain, Celo is transitioning to an Ethereum Layer 2 (L2) using the Optimism OP Stack. This transition, initiated in Celo Governance Proposal (CGP-133), enhances security, scalability, and interoperability with the Ethereum ecosystem while maintaining Celo's core features, such as mobile accessibility and low transaction costs.
Celo’s architecture includes:
- Execution Layer: EVM-compatible, allowing Ethereum-based smart contracts and decentralised applications to be deployed directly on Celo.
- Data Availability Layer: Utilising EigenDA for cost-efficient off-chain transaction data storage.
- Settlement Layer: Transactions are finalised on Ethereum L1, leveraging its security guarantees.
Key changes introduced with the L2 upgrade include:
- Centralised Sequencer: Replacing the former Byzantine Fault Tolerant (BFT) consensus mechanism. Validators no longer produce blocks but still participate in governance and receive staking rewards.
- Token Duality: CELO functions as both a native token and an ERC-20 token across both L1 and L2.
- Native Bridge: A direct bridge connecting Celo L2 and Ethereum for seamless cross-chain asset transfers without third-party services.
- Fee Abstraction: Users can pay gas fees in various ERC-20 tokens, expanding accessibility beyond the native CELO token.
Celo maintains decentralised governance, where CELO token holders propose and vote on protocol changes. The migration process includes technical modifications, such as removing the BFT validator infrastructure and reducing block times from 5 seconds to 1 second.
CELO is the native utility and governance token of the Celo blockchain. Initially launched as a native asset on Celo's Layer 1 blockchain, it now functions as both a native token and an ERC-20 token on the Layer 2 network. This token duality ensures compatibility across both Celo and Ethereum ecosystems without the need for token wrapping or conversion.
The CELO token has a fixed supply of 1 billion tokens, with a portion reserved for the Celo Foundation and community initiatives. The L2 migration introduces smart contract-based reward distribution, replacing epoch-based staking rewards.
Transaction Fees: CELO is the primary asset for paying gas fees on the Celo blockchain. The Layer 2 transition introduced an EIP-1559 fee model, with a base fee floor of 25 Gwei on testnets.
Staking and Security: CELO can be staked to secure the network, with staking rewards distributed through smart contracts. Validators no longer produce blocks but continue to participate in governance and receive rewards.
Decentralised Governance: CELO powers the Celo Governance Smart Contract, which manages protocol changes and network upgrades. Governance involves:
- Proposal Submission: Users submit proposals with a CELO deposit.
- Approval Phase: Initial approval by a multi-sig controlled by the Celo Foundation.
- Referendum: Token holders vote using locked CELO.
- Execution: Approved proposals are executed by the governance contract.A hotfix process is available for critical issues requiring immediate action.
Gas Fee Abstraction: Users can pay transaction fees using multiple ERC-20 tokens, including cUSD, cEUR, cREAL, USDC, and USDT.
Bridging and Interoperability: CELO supports cross-chain transfers between Ethereum L1 and Celo L2 through a native bridge, maintaining compatibility across both chains.
Validator and Staking Rewards: Despite the removal of active validators in the consensus process, staking rewards remain available and are distributed via smart contracts.
Celo was created by cLabs, a blockchain technology company founded in 2017 by:
- Rene Reinsberg – Entrepreneur and co-founder of GoDaddy’s domain marketplace.
- Marek Olszewski – Former Google AI researcher and co-founder of Locu.
- Sep Kamvar – Former MIT professor and decentralised systems expert.
cLabs is supported by the Celo Foundation, a non-profit entity focused on promoting the development of the Celo ecosystem. The Foundation oversees grants, partnerships, and community initiatives aimed at expanding Celo's global adoption and financial inclusion mission.
The migration from L1 to L2 was initiated by cLabs and the Celo community through CGP-133, with continued collaboration between the Foundation, node operators, and ecosystem developers.
