Question 1

What is CHZ?

Accepted Answer

CHZ is the native token of Chiliz Chain: users use it to pay Gas for onchain transactions and smart-contract execution, while validators and delegators support network security by staking or delegating CHZ. It is also the foundational asset for network fees, staking, and governance. This FAQ refers to native CHZ on Chiliz Chain. Historical or wrapped versions on other chains must be understood according to their respective bridge and contract arrangements and must not be conflated with the onchain uses of the native asset.

Question 2

Why can CHZ be used to pay Gas fees?

Accepted Answer

When transferring assets, deploying contracts, or calling contracts on Chiliz Chain, transactions consume execution resources and users pay Gas in CHZ. The final cost is determined jointly by the Gas required for the operation and the Gas price used: more complex operations generally require more Gas, while paying a higher priority fee also increases the cost. Gas fees are the network cost of processing and recording transactions, not an application subscription fee. Through the EIP-1559 mechanism, the protocol burns most accumulated Gas fees at the protocol layer; transaction priority fees are also related to validation and staking rewards, so network use links to both CHZ supply and incentive mechanisms.

Question 3

How does staking or delegating CHZ support the network?

Accepted Answer

Validators run nodes and participate in block production and transaction validation; users can delegate CHZ to validators, giving them corresponding staking support without running nodes themselves. Staking and delegation therefore allocate economic weight to participants maintaining the network. Delegation does not mean receiving an unconditional fixed return. Validator performance, commission, delegation size, and protocol rules all affect a delegator's actual outcome; users must select validators themselves and follow the applicable staking process.

Question 4

Where do CHZ staking rewards come from, and how are they distributed?

Accepted Answer

CHZ staking rewards have two sources: newly issued CHZ for each block, and priority fees paid by users to increase transaction priority. Validators receive rewards for participating in network validation, then distribute the distributable portion to delegators according to their commission settings and delegation relationships. Therefore, rewards are not merely transfers among existing holders. Block issuance increases supply, and priority fees depend on onchain activity; the actual amount received by delegators is also affected by validator commission, relative delegation share, and the degree of network participation.

Question 5

Is the supply of CHZ fixed?

Accepted Answer

CHZ supply is not fixed. Tokenomics 2.0 has an initial annualized inflation rate of 8.80%, which declines each year according to a decreasing formula and stabilizes at 1.88% from year 14 onward. This means the protocol continues to issue new tokens, but the issuance rate declines over time rather than supply becoming fixed at a given point. Of newly issued tokens, 65% is allocated to validators and delegators, 10% to the community treasury, CHZ liquidity pools, and potential shared-security restaking rewards, and 25% to ecosystem and operational allocations. Actual net changes in supply must also be considered together with Gas-fee burns.

Question 6

How do Gas-fee burns affect CHZ supply?

Accepted Answer

Chiliz Chain burns most accumulated Gas fees at the protocol layer. Fees paid by users for onchain operations therefore form a source of burns; when onchain transactions and Gas consumption increase, the potential amount burned generally also increases. Burns and inflation must be understood together: new issuance increases CHZ, while Gas-fee burns reduce CHZ. Net supply can decline only when burns exceed new issuance during the same period; the existence of a burn mechanism itself does not guarantee deflation.

Question 7

Can CHZ holders participate in governance?

Accepted Answer

CHZ can be used to participate in Chiliz Chain's onchain governance, including submitting and voting on governance proposals. Governance allows eligible participants to express views on network-related matters, rather than allowing every holder to directly decide every matter across the entire ecosystem. Voting eligibility, weight, proposal thresholds, and post-approval execution processes depend on the staking and governance rules in effect at the time. Holding CHZ is one basis for participation, but actual governance authority must be confirmed under the specific mechanism.

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