Crypto Flash Crash: ZKJ, KOGE Plunge 80% Amid Manipulation

On June 16, the crypto market experienced extreme volatility, with ZKJ and KOGE both suffering flash crashes of over 80% on the evening of June 15. ZKJ alone saw liquidation amounts reach $93.68 million. On-chain analysis identified three major addresses engaging in a premeditated "pool withdrawal + sell-off" strategy to orchestrate the crash. The strategy involved first dumping KOGE, then dragging ZKJ down with it, creating a classic bull trap.

There were early warning signs leading up to the crash. These included liquidity providers (LPs) pulling out liquidity, annual percentage yields (APYs) plummeting, and declining wash trading volumes. Additionally, ZKJ is scheduled to unlock more than 15 million tokens on June 19, further intensifying bearish pressure.

Analysts have highlighted several key issues exposed by this flash crash. These include fake liquidity and a lack of governance transparency within the Alpha ecosystem. In the short to medium term, it is advised to avoid or reduce participation in trading altcoins that are reliant on Alpha points. ZKJ and KOGE have lost market confidence, and without strong capital injection, a rebound is unlikely.

Investors are advised to stop wash trading for arbitrage and to be cautious of tokens with high fully diluted valuations (FDV), price stability anomalies, and unusual rankings. It is crucial to carefully select investments and monitor whether Binance adjusts the Alpha mechanisms. A final reminder from analysts is that "high returns do not equate to low risk, and incentive points do not equate to risk immunity." Returning to fundamentals and practicing risk management is the true path to success.