- ZKJ plummeted 63% in under 2 hours, triggering $99M in liquidations amid rug pull accusations.
- Six whale wallets dumped over $9.6M in ZKJ after draining liquidity from both ZKJ and KOGE tokens.
- The KOGE/USDT pool ran dry, causing a chain reaction as LPs converted KOGE to ZKJ, crashing both tokens.
ZKJ, the native token of the Polyhedra Network, experienced a devastating flash crash on June 15, plummeting more than 63% in under two hours and triggering over $99 million in liquidations. The sudden collapse sparked widespread accusations of a coordinated rug pull within the crypto community, as large wallet activity and liquidity issues came to light.
According to blockchain tracking service Lookonchain, six whale wallets were at the center of the sell-off. These wallets collectively sold 5.23 million tokens for approximately $9.66 million just before the crash. Before dumping their holdings, these wallets had pulled liquidity from both ZKJ and a related token, KOGE. They converted KOGE into ZKJ and then sold off their token positions en masse. This aggressive sequence drained market liquidity, prompting a sharp price drop and forcing the liquidation of highly leveraged long positions.
The scale of the damage was significant. CoinGlass data reported that the token alone was responsible for 81.3% of all crypto liquidations in a four-hour window, with six individual traders each suffering losses exceeding $1 million. The token’s price fell from $1.98 to as low as $0.7625 on CoinGecko, while CoinMarketCap data showed an even steeper plunge to $0.33. This collapse slashed ZKJ’s market cap to under $95 million. Although a temporary rebound brought the token back to $1.41, it quickly fell again and was hovering near $0.80 by midday.
ZKJ Crash Linked to KOGE Pool Liquidity Failure
What alarmed investors further was the context: the token had traded in a relatively stable range between $2.05 and $1.98 for more than a month. The abrupt breakdown shattered that stability and deepened suspicions of manipulation.
On Crypto X (formerly Twitter), users quickly raised red flags. Many accused the Polyhedra Network of orchestrating a “pump and dump” or a “long-planned harvesting operation.” Influential user ETH APPLE pointed to the sudden liquidity vacuum in the KOGE/USDT pool as the initial trigger. According to the post, the KOGE pool ran out of USDT, leaving liquidity providers unable to exit. This led to a massive conversion of KOGE into ZKJ, flooding the ZKJ market and crashing both tokens.
“The issue began when the KOGE pool ran out of USDT, leaving LPs unable to exit positions,” ETH APPLE wrote. “This led to a mass sell-off of KOGE into ZKJ… the KOGE team hadn’t added any USDT to the pool.”
The event highlights critical vulnerabilities in decentralized finance, particularly in liquidity pool design, large wallet concentration, and a lack of transparent communication. As the market absorbs the shock, the crypto community is calling for accountability and preventive measures to safeguard against similar collapses in the future. The Polyhedra team has yet to release an official statement.