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ZKX’s recent shutdown resonated within the cryptocurrency community and prompted investor and market maker Amber Group to share its perspective and important information to promote transparency and support the community. Amber Group revealed in a post on X that the announcement of ZKX ceasing operations on July 30 shocked them as much as it did the crypto community.
Amber Group Faces ZKX Shock
The company disclosed that it closely engaged with ZKX as a market maker during the token generation event (TGE) held on June 19 by facilitating liquidity. Amber Group received a loan of 2 million ZKX tokens under a standard credit agreement at no additional cost to ensure smooth market operations. According to the investor, the strategy was to provide consistent liquidity and a market-neutral position, vital for the long-term success of projects and their communities.
Despite the lack of organic purchasing interest at the launch, Amber Group continued to buy ZKX tokens to maintain liquidity even as prices fell. However, on June 24, the ZKX team requested the return of 1 million ZKX tokens to reduce circulation and boost community confidence. Amber Group agreed, reducing the token loan to 1 million tokens.
Due to its liquidity provision efforts, Amber Group accumulated 2 million ZKX tokens from the open market, increasing its total assets to 3 million ZKX tokens, including 1 million token loan and 2 million net accumulated tokens.
Details on the Matter
Hashkey Capital and other investors expressed their frustrations and disappointments with the ZKX Protocol, stating that they, like other investors, did not receive sufficient transparency and accountability regarding financial information, operational plans, and decisions from the protocol.
According to Hashkey, the failure of ZKX Protocol to provide transparent and timely disclosures about its operations and management eroded trust and confidence in the project. Furthermore, ZKX’s unresponsive communication style was frustrating, and founder Eduard Jubany Tur’s handling of the situation was deplorable.
On July 31, ZKX Protocol, a social futures trading platform operating on the Ethereum-based Starknet network, ceased its operations. Its founder cited the lack of viable economic prospects for the project’s continued existence.
