Polyhedra Pledges More Token Buybacks After ZKJ Crash Triggered by Alleged Financial Attack

Polyhedra Network, the company behind the zero-knowledge protocol zkBridge, is ramping up efforts to stabilize its native token, ZKJ, after a dramatic price crash that wiped out nearly 85% of its value in hours.

The crash, which occurred on Sunday, saw ZKJ plummet from around $2 to just $0.30. In a statement Monday, co-founder Tiancheng Xie said the company will continue buying back tokens in response to what he described as a “financial attack.”

“We will buy back more,” Xie posted on X. “Now we need to understand the current situation and prevent future financial attacks.”

Polyhedra later published an initial report identifying several key factors behind the sudden collapse. The company pointed to a coordinated on-chain liquidity assault, large token deposits from crypto trading firm Wintermute to centralized exchanges (CEXs), and a wave of cascading liquidations as the main culprits.

The event marks a sharp setback for the once high-flying project, which reached a $1 billion valuation in March following a $20 million strategic funding round led by Polychain Capital. Backers included high-profile investors like Animoca Brands and Hashkey Capital. ZKJ, which launched in March 2024, previously hit an all-time high of $3.40 and had been trading in the $1.10 range before gradually climbing over the past few months.

Despite the turmoil, Xie remained defiant.

“I know everyone’s criticizing us right now,” he acknowledged. “But we’ve faced this before. We turned criticism into praise last time, and we can do it again — even better than before. Our tech is rock solid. We won’t back down from shady financial attacks.”

Polyhedra’s zkBridge protocol aims to enhance blockchain interoperability using zero-knowledge proofs, with a focus on improving both proof generation and verification speed. The project has drawn attention for its technical promise, and the team insists the underlying tech remains intact despite recent volatility.