The Importance of Deploying Idle Funds on zkSync Era Chain

On April 28th, according to data disclosed by Nansen Research on social media, the top 25 top whale bridging users on zkSync Era currently hold 32% of the total holdings of on chain tokens, mainly concentrated in ETH, USDC, and MUTE, indicating that there is still a large amount of “idle funds” on zkSync. In addition, data shows that the activities on the zkSync Era chain mainly revolve around DEX, especially the liquidity providers (LPs) on SyncSwap, iZUMi Finance, Mute.io, and Velocere. Currently, most LPs are concentrated in the ETH/USDC pool, while idle funds on the zkSync Era chain are still waiting to be deployed.

Data: 25 giant whales on zkSync Era hold 32% of the tokens on the chain, with a large amount of “idle funds” on the chain

As of April 28th, according to data obtained by Nansen Research, the top 25 whale bridging users on zkSync Era hold 32% of the total holdings of on-chain tokens, and these holdings are mainly concentrated in ETH, USDC, and MUTE. This indicates that there is still a large amount of idle funds on zkSync Era waiting to be deployed. In addition, data also reveals that most of the activities on the zkSync Era chain are focused on DEX, particularly the liquidity providers (LPs) on SyncSwap, iZUMi Finance, Mute.io, and Velocere. However, most of these LPs are concentrated in the ETH/USDC pool, leaving a significant amount of funds unused on the chain. Thus, it is crucial to deploy these idle funds for the chain’s overall growth and development.

What is zkSync Era?

zkSync Era is a Layer 2 scaling solution for Ethereum that makes transactions faster, more reliable, and significantly cheaper. It is a self-contained data layer that operates on top of the Ethereum blockchain and offers several advantages over traditional Layer 2 solutions, such as transactions taking place off-chain, and transaction fees being cut down to a minimum.

The DEX Concentration on zkSync Era Chain

Without a doubt, zkSync Era is best utilized for decentralized exchanges (DEXs). Currently, DEXs are on the rise, with platforms such as SyncSwap, iZUMi Finance, Mute.io, and Velocere offering a range of services and products. However, most LPs on these platforms are focused on the ETH/USDC pool, while other pools remain largely untapped. This signifies that there is an opportunity for growth and expansion, and deploying idle funds could help boost liquidity and support other token pairs on the DEX.

The Need to Deploy Idle Funds on zkSync Era Chain

Maintaining idle funds on the zkSync Era chain is inefficient and unproductive. These funds could instead be utilized to enhance transactions, contribute to more liquidity, and drive growth on the DEX. Furthermore, the increase in liquidity could generate more trading volume, benefiting both the token holders and the overall ecosystem.
Deploying idle funds on the zkSync Era chain is simple and straightforward. Users can put these funds to work by being a liquidity provider or staking them in a particular pool. Adding more liquidity, particularly to smaller token pairs, creates depth in the order book, increasing the chances of trades being executed and increasing overall liquidity.

Conclusion

The zkSync Era chain is brimming with potential, and deploying idle funds is a crucial step towards realizing it. The concentration of LPs in the ETH/USDC pool highlights the untapped potential for growth and the need for more liquidity on the platform. By deploying idle funds on zkSync Era, users not only support the entire ecosystem but also get an opportunity to earn interest or rewards from LP fees. Ultimately, deploying idle funds is a win-win situation for all stakeholders.

FAQs

1. What is zkSync Era, and how does it work?
zkSync Era is a Layer 2 scaling solution for Ethereum that operates on top of the Ethereum blockchain. It makes transactions faster, more reliable, and significantly cheaper by moving them off-chain.
2. Why is it crucial to deploy idle funds on the zkSync Era chain?
Deploying idle funds could help boost liquidity, generate more trading volume and support smaller token pairs, thus driving growth on the DEX.
3. How can users deploy idle funds on the zkSync Era chain?
Users can deploy idle funds by being a liquidity provider or by staking them in a specific pool. Adding liquidity to smaller token pairs increases depth in the order book and increases overall liquidity on the exchange.