The Starknet ecological project ZKX, which raised tens of millions of dollars, announced its closure! Token ZKX flash crash

This site (120btc.coM): ZKX, a derivatives trading platform on Starknet with a financing background of tens of millions of dollars, announced its closure due to low user participation and serious lack of revenue. The founder of the protocol, Eduard Jubany Tur, called on users to Withdraw funds before the end of August. As soon as the news came out, ZKX tokens fell by more than 34.8% during the day.

ZKX with a strong financing background

As the first derivatives trading platform with self-custody and community governance on Ethereum L2 Starknet, ZKX aims to serve StarkNet and Ethereum through decentralized nodes and excellent trading experience. of users offer perpetual futures and other derivatives.

It is reported that the agreement has completed two rounds of financing of US$4.5 million and US$7.6 million respectively in July 2022 and June this year. Participating institutions include Flowdesk, GCR, DeWhales, Hashkey, Amber Group, Crypto.com and StarkWare, can be said to have strong backgrounds.

On June 19, ZKX tokens were released on the exchanges KuCoin, Gate.io and Bitget with the launch of airdrop and staking functions. While rewarding early participants in the ecosystem, users can also pledge ZKX tokens are used to earn part of the platform’s revenue, thereby motivating a stable and loyal user base.

Founder’s Statement: We have always been unable to make ends meet

However, ZKX founder Eduard Jubany Tur admitted in a tweet last night (30) that due to very poor user participation, the protocol cannot make ends meet, and the ZKX trading market will It will be closed immediately and the agreement will cease operations and updates.

Despite our best efforts, we are unable to find an economically viable development path.

Tur also listed the following reasons for this:

• Lack of user participation: Only a small number of users participate in the mining reward program to obtain STRK and ZKX

• Income has fallen sharply: transaction volume continues to decline, and daily income is only Can barely afford the cost of cloud servers

• The results of the token issuance did not meet expectations: the tokens were undervalued, holders cashed out and there was insufficient demand, so the value of the tokens could not continue to support the operation of the protocol

He emphasized that there was a shortage of funds As a result, the team is unable to pay employee salaries and other basic operating costs: Although the market makers have tried their best, the high monthly expenses and the amount given to the market makers have far exceeded our income; and starting in August, we More fees will need to be paid.

Users must withdraw their capital before the end of August

As a result, Tur had to take closure action, saying that all trading markets and positions have been delisted and liquidated, and all market funds have been returned to users’ trading accounts, which must be completed within 8 Transfer funds back to their respective self-hosted wallets before the end of the month: We thoroughly evaluated the possibility of cross-chain scaling, but we realized that a large portion of the entire code would need to be rewritten, tested, and re-audited, which would come with a huge cost. In light of these challenges and the significant investment required, we have made the difficult decision to end platform operations.

Coin price flash crash, just like a Rug Pull scene

With the news of the suspension of operations, CoinGecko data shows that the price of ZKX tokens fell by 34.8% during the day, almost halving; and the all-time high since the day after its launch Since hitting $0.62, it has fallen 96.4%, just like a Rug Pull scenario.

The above is the detailed content of The Starknet ecological project ZKX, which raised tens of millions of dollars, announced its closure! Token ZKX flash crash. For more information, please follow other related articles on the PHP Chinese website!