The sharp decline of Token ZKJ shocked the cryptocurrency market
The actual situation regarding the price decline of Token ZKJ
On June 15, the ZKJ Token of the Polyhedra project lost more than 85% of its value in a short time. The main cause stemmed from a cascading reaction after a coordinated on-chain liquidity attack. Related addresses quickly dumped ZKJ after large withdrawals from PancakeSwap. The imbalance in the KOGE/ZKJ pool caused the Token price to plummet uncontrollably. This was a heavy blow to the sentiment of cryptocurrency investors, causing significant damage to leveraged positions and trading volume in the market.
Liquidity attack and activities from Wintermute
During the crisis, Wintermute – one of the major investment funds in the cryptocurrency sector – transferred about 3.39 million ZKJ to a centralized exchange (CEX) in less than a day. This increased selling pressure, accelerating the exodus from this Token. In addition, over 94 million USD was forced to liquidate on CEX platforms, triggering a cascading effect of price drops and creating a deep 'vortex' in the cryptocurrency market, warning investors about the high risks of liquidity manipulation and market maneuvering.
Response from the Polyhedra team
According to the official announcement from the Polyhedra development team, the members of the group did not sell Token ZKJ; they only provided liquidity to maintain the project's operations. More detailed information about the incident and in-depth analysis will be released soon. The investing community needs to closely monitor new developments to make appropriate strategic decisions while the market remains very volatile.
The impact of the ZKJ price crash on the cryptocurrency market
Challenges and Opportunities
The decline of ZKJ is a reminder of liquidity and risk in the cryptocurrency market. The manipulation chains and liquidity attacks reveal many existing weaknesses in the current blockchain ecosystem. However, this is also a time for potential investors to learn how to defend themselves and build safer strategies to minimize harm when the market fluctuates.
Precautionary measures for investors
Diversifying the portfolio, setting reasonable stop-losses, and closely monitoring large withdrawal activities on exchanges are essential strategies to cope with unexpected events. Additionally, thoroughly assessing projects and understanding tokenomics mechanisms, especially activities related to liquidity provision and Token lockup, will help mitigate portfolio risks during times of high market volatility.
Summary: The cryptocurrency market is always fraught with risks, especially when liquidity manipulation activities occur. Investors need to be vigilant, proactively update information, and build safe strategies to protect their assets. The price drop of ZKJ is a valuable lesson, as well as an opportunity to raise awareness about risk management in this rapidly developing industry.
Source: https://tintucbitcoin.com/bao-cao-ban-dau-ve-sap-chain-chainpolyhedra/
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