ZKsync, an Ethereum-based layer-2 blockchain platform, has experienced a notable 21% decline in its token value following a recent airdrop, due to increasing selling pressure.

The highly anticipated distribution of “ZK” tokens initially set the market capitalization of the asset close to $900 million. However, the excitement was short-lived as the token’s value has dropped 21% since then and 26% from its peak of $0.3098.

On June 17, the ZKsync team executed the token airdrop amidst initial controversy. Immediately afterward, Binance announced the token’s listing, providing ample liquidity for trading. Currently, ZKsync is down by 21.76% in the past 24 hours, trading at $0.2245. Trade volume has surged 1,970% to $1.3 billion in the last 24 hours, reflecting significant trading activity. The token’s market cap now stands at $811 million.

The decline in value is attributed to the immediate sell-off by airdrop recipients, a common trend in the crypto market where beneficiaries rush to liquidate their holdings for quick gains.

This pattern is not new in the crypto space. For instance, Notcoin (NOT) collapsed by nearly 40% a week after its airdrop due to a surge in selling pressure. Interestingly, the token has recovered from this drop, now up 134% over the past month. However, there is no guarantee that ZKsync will follow a similar path.

Despite technical issues and concerns regarding its token distribution strategy, nearly half of the ZK tokens were claimed shortly after the airdrop began. The platform faced technical challenges and concerns over Sybil attacks, where one user creates multiple accounts to receive more tokens, casting a shadow over the event.

The initial response from the crypto community was enthusiastic, with pre-market pricing on perpetual exchange Aevo valuing ZK at $0.67 at one point, which would place the airdrop’s fully diluted value (FDV) above $2.41 billion. However, this sentiment quickly shifted as selling pressure took hold.

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