Polyhedra Network is raising the alarm after its token, ZKJ, crashed by a massive 80% on Sunday. In a post shared Monday, the team said the sudden drop was caused by a coordinated liquidity attack and suspicious activity involving major trading firm Wintermute.
According to the team, several wallets worked together to pull liquidity from the ZKJ/KOGE pool on PancakeSwap, then quickly dumped large amounts of ZKJ. That heavy selling overwhelmed the market and caused the token’s price to collapse on both decentralized and centralized exchanges.
Their investigation also flagged a Wintermute-linked wallet that moved more than 3.39 million ZKJ tokens to centralized exchanges right around the time of the crash. The same wallet sent similar amounts to other addresses, including ones tied to exchanges, raising even more questions about what really happened.
“The initial investigation highlights substantial token transfers by Wintermute coinciding with extreme market volatility and a coordinated withdrawal of liquidity from PancakeSwap’s ZKJ/KOGE pool,” the team said.
“These actions removed critical market depth, particularly in a pool with fragile, concentrated liquidity provisioning.”
In the wake of the collapse, KOGE, the governance token for BNB48 Club, was also pulled into the controversy. Polyhedra co-founder Tiancheng Xie alleged that “KOGE rugged all of us”, hinting at coordinated manipulation. However, members associated with KOGE quickly denied involvement.
“After throwing $KOGE and Wintermute, only your damn air project is innocent,” adding more heat to the growing tension.
Polyhedra hasn’t directly blamed Wintermute, but the timing and size of the token transfers linked to them have raised a lot of questions in the crypto space. It’s sparked fresh debate about how vulnerable DeFi liquidity pools and centralized exchanges really are.
At the peak of the crash, ZKJ tumbled from $2 to just $0.32, a drop of more than 90% that wiped out close to $500 million in market value within a few hours. It has recovered slightly since then and was last seen trading around $0.39.
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