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LayerZero’s ZRO token leads the market decline with a 14% decline.
Interoperability giant LevelZero saw a significant drop in the value of its native token, ZRO, which plummeted by 14%, making it the top loser in the cryptocurrency market today.
At the time of writing, according to CoinMarketCap, ZRO is trading at $2.68, down 13% over the past 24 hours. During this period, the token’s trading volume dropped by 41% to $146 million.
24 Hour ZRO Price Chart | Source: CoinMarketCap
Additionally, the market capitalization of LayerZero’s crypto assets has fallen below $700 million, now standing at $670.8 million.
LayerZero is a fully connected mesh network that allows smart contracts distributed across different blockchains to interact with each other. The technology, known as cross-chain interoperability, is seen as a significant solution for connecting value across isolated decentralized networks.
The latest ZRO price collapse The price of ZRO coincides with a widespread sell-off in the cryptocurrency sector, with many tokens suffering double-digit losses.
Bitcoin, for example, fell below the critical support level of $63,000, while the overall market capitalization of all tokens fell 3.5% over the past 24 hours to $2.27 trillion.
The price drop also follows user dissatisfaction with LayerZero’s proof-of-donation mechanism during its airdrop. Airdrop applicants had to donate $0.1 to the Protocol Guild to receive their tokens, an unconventional approach that met with criticism.
Additionally, some users have reported not receiving token allocations, causing further dissatisfaction. In response, the developers launched a platform where users can appeal and correct their allocations.
Additionally, the decline comes as some ZRO beneficiaries have liquidated their positions. Recently, many Recipients of the zkSync airdrop similarly downloaded their tokens following distribution.
The broader market environment also contributed to ZRO’s decline, with all of the top 100 cryptocurrencies in the red over the past 24 hours.
Major bears include ENS (-10%), WIF (-13%), JASMY (-10%) and FLOKI (-10.7%), among others which recorded losses between 5% and 10%.
The Fear and Greed Index has moved into the neutral zone, currently sitting at 51.
The future trajectory of LayerZero’s price will largely depend on the overall performance of the cryptocurrency market in the coming weeks. If Bitcoin continues its downtrend and falls below $56,527, its lowest point in May, ZRO is likely to continue its downtrend.
Altcoins often follow Bitcoin’s movements closely, reaching multi-year or all-time highs when Bitcoin hits new records and retreating when Bitcoin loses momentum.