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An Analysis of zkSync Era: A Look at the Top Whale Bridging Users and Idle Funds

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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 chai

An Analysis of zkSync Era: A Look at the Top Whale Bridging Users and Idle Funds

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

Introduction

On April 28th, Nansen Research disclosed data that revealed the top 25 top whale bridging users on zkSync Era held a staggering 32% of the total on-chain token holdings. These holdings were mainly concentrated in leading cryptocurrencies such as ETH, USDC, and MUTE. This data points towards a significant amount of “idle funds” on the zkSync Era chain, despite the increasing activities on the platform, which revolve mainly around decentralized exchanges (DEX).

The Top Whale Bridging Users

The top 25 whale bridging users on zkSync Era have immense control over on-chain token holdings. These high-value accounts mostly contain ETH, which comprises over 60% of the tokens held, followed by USDC and MUTE. The concentration of major tokens in only a few user accounts suggests that a lot of funds remain inaccessible on the chain.

Concentration of Activites on Decentralized Exchanges

zdSync Era’s decentralized exchanges (DEX) have been an attractive feature for many users, as they provide lower fees and higher returns than centralized exchanges (CEX). The DEX activities, mainly revolving around liquidity providers (LPs), are concentrated on platforms such as SyncSwap, iZUMi Finance, Mute.io, and Velocere.

The Largest Liquidity Pool

The ETH/USDC liquidity pool is currently the largest, with most LPs concentrated in it, contributing to the network’s increased transactions. The concentration of funds in this pool indicates an overreliance on few markets, which exposes users to significant risks when sudden market changes occur.

The “Idle Funds” And Their Deployment

Despite the increased use of the platform and the exponential growth in activities on zkSync Era, a significant amount of funds remain idle on the chain. Given the potential gains available from DEX activities, it is surprising that many funds are still waiting to be deployed. Projects and applications that can deploy idle funds will undoubtedly benefit significantly.

Conclusion

ZkSync Era is a growing platform that has attracted many users to its decentralized exchange services. While it might seem that the network has seen some impressive growth, the concentration of a few whale bridging users controlling a significant percentage of on-chain assets and the prevalence of idle funds on the chain reveal the need for more active participation from users. Nonetheless, the continued growth and increased activity on the platform point towards a clear potential for future development.

FAQs

1) What is zkSync Era?

zkSync Era is a growing platform that features a fast and cost-effective scaling solution for Ethereum transactions. It provides a Layer 2 scaling solution built on zkRollup architecture, which allows for faster and cheaper transactions without compromising security.

2) What are the top tokens held by whale bridging users on zkSync Era?

The top tokens held by the top 25 whale bridging users on zkSync Era are ETH, USDC, and MUTE. ETH accounts for over 60% of the tokens held.

3) Are there any risks associated with holding funds on zkSync Era?

While holding funds on any blockchain comes with inherent risks, the concentration of funds on few liquidity pools on zkSync Era might expose users to greater risks in times of market turbulence. It is always advisable to assess and manage risks when dealing with any cryptocurrency.

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