Ethereum

2024

Security

ZKX Protocol on StarkNet closes due to economic strain, despite extensive efforts to maintain operations Security breaches and low user mining rates contribute to the ZKX Protocol’s closure. ZKX Protocol’s closure raises concerns about the stability of Ethereum’s Layer 2 ecosystem. ZKX Protocol, a derivative protocol built on the Ethereum Layer 2 solution StarkNet, has decided to cease operations, citing economic challenges as the primary reason. Eduard Jubany Tur, the founder of ZKX, announced the closure, noting that despite significant efforts, the protocol could not maintain economic viability.&nbsp; In a detailed statement on X, Eduard outlined the gradual cessation of operations. ZKX Protocol has delisted all markets and closed user positions, ensuring all funds are returned to users’ trading accounts. Important Statement 30.07.24With much regret, we have to announce the discontinuation of the ZKX protocol. Despite our best efforts, we have been unable to find an economically viable path for the protocol.(1) All markets have been delisted, positions have been closed and all…— Eduard (@0xEduard) July 30, 2024 Users can transfer funds to their main self-custodial accounts and withdraw via the StarkWay bridge to Ethereum Layer 1. The protocol has set the end of August as the deadline for these actions, with vesting and distribution of ZKX to continue until September 1. Challenges Leading to Closure Eduard revealed that the ZKX Protocol struggled to generate enough daily revenue to cover basic expenses like cloud server costs. This financial shortfall made sustaining employee salaries and other operational expenditures untenable.Despite efforts to boost user engagement and trading activity, only a few users participated in mining STRK and ZKX rewards, further contributing to the protocol’s downfall. ZKX also encountered security issues, including hacks and scam attempts, which are becoming increasingly common in the Web3 and crypto ecosystem. Such security breaches have affected ZKX and other entities within the Ethereum Layer 2 networks, indicating a need for heightened security measures across the board. Despite the setbacks, protocols like ZKX have contributed to Ethereum’s development and staking processes. The potential destabilization of such Layer 2 solutions could affect the overall performance...
<p>The post <a href="https://cryptonewsland.com/zkx-protocol-shut-down-operations-due-to-economic-challenges/">ZKX Protocol Shut Down Operations Due to Economic Challenges</a> appeared first on <a href="https://cryptonewsland.com">Crypto News Land</a>.</p>

ZKX Protocol Shut Down Operations Due to Economic Challenges

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