As a seasoned researcher who has witnessed numerous ups and downs in the ever-evolving crypto market, I find the closure of ZKX Protocol yet another reminder of the unpredictable nature of this space. While the recent funding round gave hope for a bright future, it appears that market conditions and the broader exhaustion in DeFi took their toll on the platform.
The ZKX Trading Platform, which specializes in derivatives on the Starknet network, has ceased operations. On July 31st, founder Eduard Jubany Tur announced that due to a lack of an economically feasible plan, the platform will no longer be active.
According to Tur, lack of active user participation and reduced trading activities were primary factors leading to the platform’s closure. He observed that very few users were utilizing the rewards system, and the daily income was insufficient to cover the costs of the cloud servers.
In simple terms, all market listings have been removed, open positions have been settled, and user balances have been moved back to their individual trading accounts. By the end of August, users are required to move their funds from the trading wallets into the main self-custody account within the protocol for safekeeping.
Tur stated that the sunset phase extends until the end of August. The vesting and distribution of ZKX will carry on past sunset on September 1st.
After completing a $7.6 million investment round on June 19, this closure received financing from investors such as Flowdesk, GCR, and DeWhales. Earlier investments were made by Hashkey, Amber Group, Crypto.com, and StarkWare.
Even though they recently received funding, the protocol has faced challenges in maintaining the worth of its ZKE token. Terry acknowledged that the Token Generation Event (TGE) fell short of expectations, resulting in financial setbacks. Additionally, significant token holders selling off their tokens accelerated the decline in its value.
Additionally, Tur cited the widespread fatigue within the Decentralized Finance (DeFi) sector as one of the reasons for their choice to close operations.
Over the past 24 hours, the price of ZKX tokens decreased by 33.72%, currently sitting at $0.02 as per CoinMarketCap’s latest information. Since reaching an all-time high of $0.62 just one day after its launch on June 20th, the token has experienced a steep drop of approximately 96.4%.
The closure of ZKX Protocol underscores the difficulties that Decentralized Finance (DeFi) platforms encounter during periods of decreased user participation and falling token worth. Even with recent financial support, the protocol struggled to maintain its operations in the present market conditions.
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2024-07-31 07:48