The price of Polyhedra Network’s native token, ZKJ, known for its focus on scalability, plunged over 80% on Sunday, wiping out nearly $100 million in long positions within an hour.
Before the crash, ZKJ was trading at $1.90. It then nosedived 83% to around $0.32 as of press time, marking one of the steepest single-day drops for any major cryptocurrency project this year. The sell-off slashed Polyhedra’s market cap to just $93.8 million, an 83.7% collapse.
How ZKJ crash unfolded
According to on-chain data, the crash was triggered by a series of coordinated moves involving several large wallets.
Liquidity was quietly drained from the ZKJ/KOGE trading pairs in the hours before the event. Traders began swapping KOGE for ZKJ, only to dump ZKJ back into the market immediately.
Six whale wallets were at the storm’s center, offloading over 5.23 million ZKJ for $9.66 million. The sudden liquidity exit and intense selling pressure tanked the price, triggering a wave of forced liquidations across trading platforms.
In total, more than $99 million in ZKJ long positions were wiped out, accounting for 81.3% of all crypto liquidations. At least six individual traders were liquidated for more than $1 million each.
Suggestions indicate the crash might have stemmed from a “perfect storm” of vulnerabilities, including front-running ahead of scheduled token unlocks, a mass exit by airdrop farmers cashing out, and widespread panic as the token’s price structure unraveled.
In the aftermath, members of the 48 Club DAO, the creators of KOGE, blamed the meltdown on poor management. Outrage erupted across social media, with users demanding accountability and claiming they were “rugged from both sides.”
Further complicating the situation is a looming token unlock: 5.3% of ZKJ’s supply, worth an estimated $32 million, is set to be released in the coming days.
Featured image via Shutterstock
