The sudden shutdown of ZKX, a social derivatives trading platform on the Starknet layer-2 network, was announced on July 30 by founder Eduard Jubany Tur. The closure, citing economic infeasibility, shocked investors and market makers like Amber Group and HashKey Capital due to the abruptness and lack of communication.
Amber Group, a key market maker, revealed on X that they had worked to ensure liquidity for ZKX’s token event, receiving 2 million ZKX tokens with no fees. Despite low organic interest, Amber continued to buy tokens, accumulating 3 million by the shutdown. This lack of transparency set a concerning industry precedent.
HashKey Capital and other investors echoed these concerns, criticizing ZKX’s failure to provide transparent financial details and operational plans. Blockchain investigator ZachXBT even suggested the closure resembled a “rug pull,” although Henri from the Starknet Foundation defended ZKX, attributing the shutdown to poor decision-making.
Tur clarified that user funds were returned, with over 95% of withdrawals completed. He acknowledged underestimating operational costs and detailed the financial strains, including the impact of low demand and significant selling pressure during the token event. Despite these efforts, the $7.6 million fundraising over four years was insufficient.
The ZKX shutdown highlights the critical need for transparency and communication in the crypto industry, setting a strategic precedent for future projects.
