Zigzag was "reviled" after announcing the airdrop. Is it wrong?
This morning, ZK Rollup order book DEX ZigZag announced that it will open IDO on its own DEX at 23:00 on June 24 and issue token ZZ.
Zigzag is currently the only DEX of zksync. Its transactions are fast, the experience is smooth, and the handling fee is basically negligible. It has always been regarded as one of the potential projects on zkSync. Its issuance of tokens is an exciting thing, but The market sentiment is quite the opposite.
The reason is that ZigZag stated in its announcement that the main reason for issuing tokens is to make up for the funding gap caused by the unanchoring of UST, hoping to raise USDC through IDO to fund subsequent development. And users who participate in the first round of IDO will become DAO members and have voting rights for token use cases to determine the airdrop rules.
The statement caused an uproar in the community. There are two main focuses.
One is the purpose of ZigZag issuing tokens. There is nothing wrong with issuing tokens to raise funds to support subsequent development, but it seems unprecedented for the community to pay for the funds lost due to the UST incident.
It is reported that ZigZag has received a liquidity investment of 20 million US dollars from the Luna team, including UST. Therefore, the unanchoring of UST is bound to cause losses to Zigzag. However, the specific loss has not been publicly disclosed. However, if Zigzag really suffers huge losses due to UST, and its IDO only sells 2% of the token supply, it does not seem to help. Trust, loss of liquidity, a little bit outweighs the gain.
The second is that the initial members of ZigZag DAO will decide the details of the airdrop. Airdrops were initially offered as rewards to early adopters of the protocol. But later, because a large number of airdrops affected the real rights and interests of community members, the project party had to start to become more strict. For example, the recent Optimism, HOP and other projects have set airdrop claim thresholds.
ZigZag said in a tweet that it is also facing deliberate airdrops. There are already hundreds of thousands of wallets interacting on Zigzag, but it is impractical to reward every wallet. Therefore, it was decided to leave the airdrop distribution rules to the early DAO members who participated in the IDO. In response to this proposal, some users said that this would turn the whale into the ultimate vested interest. Whales will buy a large number of tokens in IDO to gain a voice in governance, thereby affecting the "community-driven" airdrop, which is unfair to ordinary users and violates the original purpose of ZigZag.
In addition, some netizens are worried about what if the pre-sale buyers decide after the IDO that they don't want to do the airdrop? Or what if they set parameters such that only current holders are eligible for the airdrop?
These concerns are seriously reducing users' confidence in ZigZag. Hundreds of thousands of wallets use the Bridge exchange on ZigZag to participate in liquidity transactions, and even the early users who used zigzag in the past 1 month have increased ZigZag's transaction volume by 10 times. These users have made indelible contributions. And there is currently no specific information on how to get the airdrop, when to take a snapshot, minimum transaction volume requirements, etc. The IDO price has not yet been announced. This also casts a lot of uncertainty on whether these users who participate in real transactions can receive the airdrop.
At the same time, X-Margin stated that ZigZag's current reputation has undergone a major change. According to its real-time risk monitoring function, ZigZag's rating dropped from BB rating to C rating, and its financial situation has a tendency to deteriorate. During the period of market turmoil, affected by this information and the various events mentioned above, the market's expectations for ZZ tokens have also been declining.
Some people said that if Zigzag really wants a lot of money, with its background, it can find a large investment institution and sell its shares. Therefore, Zigzag's handing over governance to the community is not empty talk. It wants to build on mutual development, not eagerly asking for money.
Of course, this is just a story before ZigZag released its tokens, and its follow-up is still unknown. However, as far as today's situation is concerned, ZigZag's behavior is indeed disappointing.
