ZKX Protocol Shuts Down Amid Economic Hurdles

Decentralized trading platform ZKX Protocol ceases operations, citing economic challenges and security concerns.

ZKX Protocol, a decentralized finance (DeFi) trading platform backed by Crypto.com, announced its shutdown due to economic difficulties. Co-founder Eduard Jubany Tur explained the decision in a statement on Wednesday, highlighting insurmountable financial issues and security threats.

"Despite our best efforts, we have been unable to find an economically viable path for the protocol," said Tur. Effective immediately, all markets on ZKX have been delisted, positions closed, and funds returned to users' trading accounts, with withdrawals possible via the Starkway Bridge until the end of August.

Tur noted the declining user engagement and trading volumes, stating, "Our user engagement has been minimal, with only a few individuals mining STRK and ZKX rewards." He added that the increased threats and persistent hacking attempts exacerbated the situation.

The protocol's token also suffered due to major holders cashing out, leading to a decline in its value. Despite efforts from market-makers, the costs have outstripped revenue, necessitating the shutdown. Founded in 2021, ZKX aimed to create a scalable decentralized exchange for perpetual trading, receiving backing from StarkWare, Amber Group, Huobi, and others.

"We started this journey wanting to build a new generation of perp app chains that could scale as much as a CEX but offer the benefits of a DEX," Tur said, acknowledging support from the Starkware team and the Starknet Foundation.

The ZKX community has been both supportive and pressuring throughout this period, Tur noted.

photo source / Blockonome