Lumoz is a decentralized ZK-RaaS platform that allows any user to generate customized zkEVM application chains without code.

In the past two weeks, the modular computing layer and ZK-RaaS platform Lumoz have been conducting node sales activities.

The sale was met with a frenzy in the market, with community users even "begging for a Lumoz presale invitation code" at a high price. During the presale phase, the first four tiers of nodes were sold out in a very short time; the current second round of node whitelist sales has accumulated over 51,000 nodes (out of a total of 100,000), with a real-time FDV exceeding 56 million US dollars.

Lumoz is not the first project to conduct node sales. Several high-quality projects, including Aethir, CARV, and ALIENX, have all carried out this practice, but Lumoz is the most popular and highly anticipated.

Under the strong narrative of "modular computing layer" and "ZK-RaaS supports one-click chain issuance," Lumoz has received support from several top-tier capital firms, including IDG Blockchain, OKX Ventures, and HashKey Capital, with a total financing of over 20 million US dollars and a valuation of 300 million US dollars. Community users are eagerly anticipating the project's launch on leading platforms.

The question arises: in the current context of Bitcoin's sustained high-level consolidation and the uncertainty of future market conditions, is participating in node sales really a good business? Among the numerous node sales projects, why is Lumoz the ultimate winner?

I. Node sales enable projects to obtain financing and loyal users

In the past few months, many projects have been conducting node sales. Why do project teams favor this approach?

An important consideration is that node sales can provide projects with a large amount of financing in the market. Especially for some projects with only a few million dollars in seed or strategic rounds, lacking sufficient funds for public chain development, node sales can provide ample funding. A representative case is Aethir, which only received 9 million US dollars in financing before the node sale in 2023, but ultimately raised over a billion US dollars through the node sale, supporting the project's listing.

Of course, this approach carries a gambling element, as if the project fails to smoothly obtain new funds through the sale for development, users who purchased nodes in advance may ultimately suffer losses along with the project. Therefore, participating in node sales requires prior assessment of the project's strength, such as its financing situation. If the financing is too low or the investment institutions are not well-known, it means the project may face a high risk of failure, and it is advisable to avoid it. From this perspective, Lumoz seems to have the most prominent financing amount among recent node sales projects.

According to public information, in April 2023, Lumoz completed a 4 million US dollars seed round of financing; in April 2024, Lumoz raised 6 million US dollars in a Pre-A round at a valuation of 120 million US dollars; in May 2024, it completed a strategic round of financing at a valuation of 300 million US dollars, with participation from IDG Blockchain, OKX Ventures, HashKey Capital, Polygon, NGC Ventures, KuCoin Ventures, Gate Ventures, G Ventures, MH Ventures, Summer Ventures, and Aegis Ventures.

Interestingly, some of Lumoz's investment institutions include exchange capital, such as OKX Ventures, which has been accompanying the project's growth from the beginning. Therefore, the community generally believes that the probability of Lumoz's future initial launch on OKX exceeds 90%, and it may even simultaneously launch IEOs on several trading platforms.

In addition to financing, node sales can help projects cultivate more loyal users and provide substantial validation support. In the early stages of a project, it is difficult to attract users directly due to a lack of visibility, and the participation of these third-party verification nodes is essential for decentralization. Therefore, node sales can effectively attract early users to participate, and most project teams reserve a certain percentage of tokens as rewards for node participants.

According to statistics, ALIENX has the largest proportion of reserved tokens at 40%, but these tokens are locked for 5 years, undoubtedly adding significant uncertainty for the future; Aethir only reserved 15% and requires a 4-year lockup. Lumoz reserves 25% of tokens with a linear unlock over three years, making it the best choice among all node sales projects when compared comprehensively.

II. Profit analysis: Is participating in node sales a good business?

It seems that node sales bring many benefits to project teams. For ordinary users, participating in node sales is an opportunity to gain excess returns on investment.

In the current crypto market, Bitcoin has been trading above 60,000 US dollars, while many altcoins have not shown significant upward movement and have even been declining. Some investors have summarized this bull market as VCs dumping, claiming that VC projects have high FDV and low liquidity. While this statement may be unfair, it reflects investors' helplessness: some high-potential projects are dominated by VCs, leaving ordinary investors as the bag holders.

Participating in node sales may be a favorable way for investors to change their investment approach. Users can participate in early-stage investments at lower valuations before the project goes public, in order to achieve higher investment returns.

(1) Participating in node sales for early involvement

Many people mistakenly believe that node sales are equivalent to public offerings, which is not entirely correct. This is because the valuation of public offerings is much higher than the valuation at the last round of financing from VCs, in other words, public offerings are akin to VCs taking over. However, node sales do not entirely follow this logic, and we can even consider node sales as participating in the primary market.

Taking Lumoz's node sale as an example, with a total of 100,000 nodes and 10 tiers, if a user buys Tier 1, they only need to spend 200 US dollars, while the project's valuation is 6.4 million US dollars, far below Lumoz's last Pre-A round valuation of 300 million US dollars. In other words, users who buy Tier 1 have the same cost as VCs in the early seed round, and there is no situation of giving VCs a chance to take over. Even if a user purchases the last tier, Tier 10, the project's final valuation does not exceed 290 million US dollars, which is basically the same as the cost of IDG Blockchain, OKX Ventures, and other institutions. Currently, the whitelist sale only goes up to Tier 6, with a project valuation of only 100 million US dollars, and the earlier the participation, the lower the valuation and the higher the returns.

In fact, Lumoz initially set the total number of nodes at 200,000 and the number of tiers at 50, which undoubtedly kept the project's valuation within a reasonable range, preventing excessive inflation, and also provided ample profit space for node participants, enhancing their ability to withstand risks.

In comparison, Aethir's previous node sale was not reasonable. By raising 100 million US dollars through node sales, the valuation was directly pushed to over 3 billion US dollars; on the first day of listing, the FDV was fixed at 3.2 billion US dollars, with no significant increase, and many participating node users became bag holders— even for Aethir Tier 1 nodes, the current node income is 31.44 ATH per day, which, at the current coin price of 0.07 US dollars, takes 7.5 months to break even.

And Lumoz's current expected node returns, even based on a post-launch FDV estimate of 300 million US dollars, users who purchase Lumoz Tier 1 nodes only need one month to break even, with a net return rate of over 20 times in six months; if purchasing Tier 5 nodes, the break-even period is 4 months, with a nearly 2.5 times return in six months. If Lumoz's valuation surges after launch, the corresponding break-even period will be even faster.

(2) Lumoz Node Rights and Costs

In addition to token distribution, Lumoz also provides more abundant rewards for node participants, which other node sales projects do not have. For example, Lumoz will provide 40 million points as a reward for node holders—during the 40-day period from June 25th to August 4th, 1 million points will be distributed daily, and after the TGE, users can exchange these points for Lumoz mainnet tokens.

More importantly, node holders can also receive multiple rewards such as potential token airdrops for new chains in the Lumoz ecosystem. Currently, the community has a scale of millions, with a total TVL of over 4 billion US dollars, and Lumoz's RaaS service now supports over 20 L2 chains, including Merlin Chain, HashKey Chain, ZKFair, Ultiverse, and Matr1x. By participating in Lumoz's node sale, users essentially receive tickets for airdrops on dozens of public chains.

Having discussed the expected returns, another question is whether the barrier to entry for participating in Lumoz is high or not? Compared to the node mining on Pionex this year, which requires powerful hardware investment and various KYC certifications, the hardware requirements for running nodes on Lumoz are relatively low: devices with a CPU of 4 cores or more, 8GB of RAM, and a bandwidth of 16 Mbit/s. Additionally, users can bind licenses to run nodes for mining, or delegate NFTs to other nodes for mining.

Of course, considering the possibility of a rate cut by the Federal Reserve in the second half of this year and the significant uncertainty in the macro environment, to prevent node participants from suffering losses, Lumoz has thoughtfully set up a "regret mechanism." Six months after the token TGE, a refund window will be opened; if users are not satisfied, they can apply for a refund and receive 80% of the initial payment, along with a return of all generated tokens and NFTs. In other words, if the token price is high at that time, users can choose to continue mining for higher profits; if they suffer significant losses, they can request a refund, only needing to bear 20% of the cost, effectively providing a safety net.

III. Potential Track: Providing Modular Computing Layer for ZK Rollup

Despite being backed by top institutions, for investors, if the project's future prospects are uncertain, it will be difficult to achieve success by participating in node sales.

Especially now, launching a chain has become the preferred choice for many Web3 entrepreneurs, with a multitude of DeFi projects such as dYdX, Magic, and FXS joining the chain launch camp, as building a native public chain commands a much higher valuation than a single project. However, for teams without native technical genes, the barrier to launching a chain is high. Lumoz is providing "shovels for sale" to projects with such needs.

Lumoz is a modular computing layer and ZK-RaaS platform that addresses the computational cost and centralization issues in ZKP proof generation and verification processes, and provides the ability for project teams to launch chains with a single click—through its codeless ZK-Rollup Launchbase, any user can generate customized zkEVM application chains without code. Additionally, Lumoz provides underlying computing power for general ZKP calculations through its Decentralized Prover Network. Beyond the Prover Network, Lumoz further opens up the verification layer to ordinary users, with its zkVerifier aiming to achieve decentralized verification, effectively reducing L2 gas costs.

"Lumoz's positioning combines ZK-RaaS and DePIN, providing low-cost and convenient ZK-Rollup deployment capabilities. OKX Ventures sees its progress in the ZK-RaaS field and Prover technology. This investment will help Lumoz accelerate the development and technological innovation of the modular computing layer and ZK-RaaS platform," commented Dora, the founder of OKX Ventures.

In fact, the potential of ZK-Rollup's development has long been proven by the industry. Ethereum has faced scalability issues since its inception, and Rollup is the mainstream Layer2 scaling solution, with the core idea of publishing "packaged" transaction data blocks on the chain to reduce the difficulty of validating transaction validity. As early as 2020, Ethereum's founder, Vitalik Buterin, updated Ethereum's roadmap, emphasizing "building around Rollup." Rollup typically includes settlement layer, execution layer, consensus layer, and data availability layer. However, for ZK-Rollup, an additional core module is required, namely the proof layer (Prover Layer). Currently, Lumoz is one of the few providers in the modular Rollup field to offer a modular Prover network.

Some pain points that the ZK Rollups track is currently facing include the high cost of computing ZKPs, and the fact that most ZK-Rollups currently rely on centralized Provers; the complexity of zero-knowledge technology makes it difficult to build EVM-compliant ZK-Rollups. To address the high cost and centralization issues of ZKP, Lumoz has proposed the ZK-PoW algorithm, greatly reducing ZKP computation costs. Since its launch, the ZK-PoW mechanism has attracted participation from 145 miners worldwide, with over 20,000 testnet verification nodes. Additionally, to ensure the security, accuracy, and decentralization of the data processing process and its results, the Lumoz network has introduced a node verification mechanism, with zkVerifier verifying the ZKPs generated by zkProver.

In summary, Lumoz's modular computing layer solution eliminates the need for project teams to consider the construction and operation of ZKP systems, reducing the difficulty of issuing ZK-Rollups for project teams. Users can independently select various components required for Layer2 in its Launch Base, including SDK, settlement layer, data availability layer, sorter, and more, without any code during the operation process, greatly reducing the difficulty of issuing ZK Rollups and allowing teams to focus on non-technical aspects such as ecosystem operations.

Conclusion

Behind top-notch technology is a strong technical core supported by the founding team. Lumoz CEO NanFeng, a graduate of Tsinghua University, and the core team have invested nearly 5 years in the research and development of ZK technology, which has led to today's Lumoz.

Currently, Lumoz's node sale has entered the whitelist stage, with Tier 6 being sold at a unit price of 402 US dollars. After the whitelist ends, the official public sale will begin at 3:00 PM (UTC+8) on July 3rd. Interested users can participate on the official website: https://node.lumoz.org/whitelist-sale.

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