Another protocol shutdown has been announced in the cryptocurrency market.
Accordingly, the decentralized finance (DeFi) lending protocol Zerolend is ending its services after three years of operation.
Zerolend announced that it has decided that its current structure is no longer sustainable, and that this decision was made following a sharp decline in user numbers and liquidity on some of the networks Zerolend supports.
The team stated that the protocol was losing money due to the increase in long-inactive chains, low profit margins, and the constant threat of cyberattacks.
The statement indicated that the decline in user numbers and liquidity, the termination of support from oracle providers, and prolonged losses on low-liquidity networks were making it difficult to maintain stable market transactions and generate revenue.
The team stated that despite continuous efforts, they were unable to overcome issues such as the discontinuation of support from the price data provider and decreased liquidity in networks like Manta Network (MANTA), Zircuit (ZRC), and X Layer (XLAYER).
The team also added that victims of last year’s LBTC attack on the Base chain will receive a partial refund using Linea (LINEA) tokens allocated by the team.
“If you have any assets remaining on the platform, please withdraw them as soon as possible.”
Zerolend will provide seamless support for the withdrawal process to protect user assets.
Following the announcement, ZeroLend (ZERO) lost more than 30% of its value.
*This is not investment advice.