After the dramatic decline of OM Coin, which fell by 90%, significant movements in various altcoins have come under scrutiny. This situation has compelled crypto teams to provide clearer updates regarding their processes. The price of ZK Coin has also started to drop unexpectedly.
What Caused the Drop in ZKsync (ZK)?
While the price of Bitcoin $84,505 has decreased due to announcements from the EU, ZK Coin’s drop has a different cause. The fall of OM Coin has triggered greater investor concerns about possible larger sell-off waves, particularly with altcoins experiencing double-digit losses. To address this, the ZKsync team has issued a statement aimed at preventing potential sudden sales from leading to greater losses.
“The ZKsync security team has detected the takeover of the admin account holding orphaned tokens from the ZKsync airdrop. Necessary security measures are being taken for a wallet that holds approximately $5 million worth of tokens.
All user funds are safe and have never been at risk. The ZKsync protocol and ZK token contract are secure, and no other ZK is at risk. This is an isolated incident caused by the compromised key and is limited to the ZK Token airdrop contract.
An investigation is ongoing, and a detailed update will be shared later today.”
Be Cautious of the Risk of Loss
The announcement from ZK clearly shows how the decline was triggered. Sudden drops in altcoins have become increasingly significant. Investors are reminded of the OM Coin case to avoid facing larger losses, making them more cautious than ever. The length of the upper and lower wicks in the chart illustrates this volatility.
Those viewing the decline as a short-selling opportunity are also feeding this volatility. Therefore, it is crucial to remember that the likelihood of witnessing double-digit movements in altcoins has increased.
