ZKsync Cancels Ignite Season 2 of Its Incentive Program

ZKsync, a Layer-2 scaling solution for the Ethereum (ETH) blockchain, has recently announced the cancellation of the second season of its incentive program, Ignite.

The price of Zk (ZK) has dropped by 19% over the past week as the community members expressed discontent over the cancellation of the second season of the Layer-2 scaling solution for Ethereum (ETH), ZkSync’s Ignite program.

As the crypto market continues to face bearish pressure, ZkSync has opted for a more cautious financial approach, which might have ultimately led to the cancellation of Ignite Season 2.

Key Highlights

On March 14, ZkSync announced via a blog post that it would be shutting down Ignite on March 17, with no more incentives or rewards to be introduced.

The announcement highlighted three main reasons for this decision. Firstly, ZkSync is focusing its efforts on transitioning towards the Elastic Network, a scalable and interoperable blockchain system.

According to the project team, continuing Ignite would divert crucial resources from this long-term vision.

“We’re also working on seamless native interoperability across the Elastic Network, which is taking longer than anticipated. As such, adding more TVL without a robust interoperability mechanism would not yield optimal returns,” the project explained further.

Finally, with the broader crypto market facing a bearish trend, ZkSync has decided to tighten spending. The protocol said:

“Unfortunately we’re navigating a bearish market now. In line with many other ecosystems, ZkSync has decided to be more conservative with spending in the short to medium term in response to these evolving conditions.”

The ZK token has seen significant downward pressure, dropping to $0.06946, marking a 19% decline in the past week and a 1% decrease in the last 24 hours, according to CoinMarketCap.

As the RSI approaches the oversold threshold of 30, it may indicate that ZK is nearing a short-term rebound, especially if buying pressure increases. However, if RSI falls below 30, it could indicate deeper bearish territory for ZK.

Moreover, ZK is currently trading near the support at the lower Bollinger Band at $0.0594. The middle band (SMA 20) at $0.0854 acts as an immediate resistance level. Another resistance is at the upper band at $0.1115.

If ZK fails to recover above $0.07, further downside could lead to a test of the $0.059 – $0.060 support zone.

However, if ZK can reclaim the $0.0854 level, it may trigger a short-term recovery. Furthermore, breaking above the $0.10 psychological level would indicate renewed bullish momentum, aiming for the $0.1115 resistance.