The long-awaited zkSync airdrop caused significant frustration as almost 90% of blockchain users were excluded, leading to widespread criticism and accusations of Sybil's attacks.

The long-awaited zkSync airdrop has sparked significant controversy this week. Although 17.5% of the ZK token supply was allocated to 695,000 wallets, nearly 90% of addresses that interacted with the blockchain were excluded. This has led to widespread frustration among the community, particularly due to Sybil attacks and ineligibility issues.

Sybil attacks involve users creating multiple fake accounts to exploit the airdrop system, undermining the intended reward for genuine early adopters. Despite efforts to distribute tokens fairly, critics argue that the zkSync airdrop failed to filter out Sybil's accounts, effectively. As a result, numerous fake accounts have received substantial allocations, while many loyal users were left out.

Mudit Gupta, Chief Information Security Officer at Polygon Labs, described the zkSync airdrop as "the most farmable and farmed airdrop ever," noting its lack of robust Sybil filtering. Adam Cochran, a partner at Synthetix, echoed these sentiments, criticising the criteria used for eligibility as easily exploitable by farmers but potentially excluding real users.

One notable incident involved 155 wallets surpassing the 100,000 token reward cap, highlighting the inadequacies in the airdrop's design. "Artemis the Sybil Hunter" revealed that Sybil accounts managed to bag over 2 million ZK tokens by depositing identical Ethereum amounts on the same day, resulting in 15,000 tokens per wallet. These accounts were flagged on LayerZero Labs' Sybil list, suggesting a broader issue with the airdrop's execution.

The crypto community's sentiment on social media, as measured by Kaito AI, reflects growing dissatisfaction. Concerns about Sybil attacks, ineligibility, and reward disparities dominate discussions, indicating a need for more thoughtful and secure airdrop strategies in the future.

Michael Egorov Faces Liquidation🌈

Michael Egorov, founder of Curve Finance, faced major liquidations after a 25% drop in the price of Curve DAO tokens, highlighting the risks of using volatile assets as collateral in DeFi.

Michael Egorov, founder of Curve Finance, experienced significant liquidations this week. The price of Curve DAO token (CRV) dropped by 25% in 24 hours, causing Egorov's on-chain loan positions, backed by CRV, to be liquidated across various DeFi platforms.

Egorov's liquidations amounted to $140 million in CRV, affecting his positions on platforms like Inverse, UwU Lend, and Fraxlend. Despite efforts to repay some loans, further liquidations occurred, emphasising the volatility and risks associated with using tokens as collateral in DeFi.

This event highlights the fragility of DeFi positions tied to highly volatile assets. As CRV's price fluctuated, the liquidation risks for Egorov's loans became a reality, demonstrating the interconnected nature of token value and loan stability in the decentralised finance space.

Terraform Labs Requests Community to Take Over🌖

Following a $4.47 billion settlement with the SEC, Terraform Labs announced its dissolution and called on the community to take over the Terra network, shifting to a community-driven management approach.

Terraform Labs, known for its Terra blockchain, announced plans to dissolve following a $4.47 billion settlement with the SEC. CEO Chris Amani called on the community to take control of the Terra network, signalling the end of Terraform's direct involvement.

The firm's decision to dissolve comes after a massive legal settlement related to the collapse of the UST stablecoin in 2022. Amani assured that all unvested Luna tokens would be burned, transferring governance to the community. This transition aims to empower users and ensure the continuation of the Terra and Terra Classic blockchains under community-led management.

This development marks a significant shift in the Terra ecosystem, moving away from centralised management towards a community-driven approach. The community's response and ability to govern effectively will be crucial in maintaining the network's integrity and future growth.

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Ethereum NFTs: The Silent Circus🤐

The Ethereum NFT market is struggling, with daily traders dropping below 4,000 for the first time since June 2021, despite some positive announcements, indicating a broader decline in NFT activity and valuations.

The Ethereum NFT market is experiencing a downturn, with daily traders falling below 4,000 for the first time since June 2021. Despite positive announcements, such as an Adidas partnership and the upcoming Pudgy Penguins game, the overall trend remains negative.

Monthly trading volumes on Ethereum have significantly declined since January, reflecting a broader decrease in NFT activity and valuations. High-profile projects like Coachella's NFT VIP passes and Starbucks' Odyssey Beta NFT program have faced setbacks, while popular collections like Bored Apes and Trump NFTs have seen plummeting prices.

The decline in Ethereum NFT trading highlights the challenges faced by the sector. With cheaper alternatives attracting activity away from Ethereum, the future of NFTs on this blockchain remains uncertain. A resurgence would likely require innovative new collections or marketplaces to reignite interest and trading activity.

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