LayerZero (ZRO) has become one of the first altcoins to rebound amid the market pullback. Despite the controversial token airdrop last month, the coin is still recording green numbers. As a result, investors and market observers remain bullish on ZRO’s long-term performance.
From ZRO to Market Hero
In late June, full-chain interoperability protocol LayerZero launched its long-awaited ZRO token. The launch included an airdrop of tokens for protocol users, but the cryptocurrency community did not respond well to it.
Users found the airdrop’s claiming mechanism to be insulting to the community. Minutes before the airdrop launched, the LayerZero Foundation announced that it would be using a new “proof of donation” claiming mechanism for those who wanted to receive their token allocation.
The mechanism requires users to donate $0.1 USDC, USDT, or ETH for each token allocated. Donations will go directly to the Protocol Guild, a collective funding mechanism for Ethereum developers.
LayerZero received a lot of backlash for this move. Many community members found that the project was “fleecing” their supporters and that proper communication was lacking. As a result, the token dropped 38% after the launch.
ZRO fell from its all-time high (ATH) of $4.57 to a low of $2.83. One week after its launch, ZRO continued to retreat, falling to its all-time low (ATL) of $2.48.
Since then, the token has recovered 53%. ZRO’s upward trajectory began last week when Bitcoin (BTC) revisited the $60,000 support area. The token rose to a two-week high of $4.2 from ATL.
However, LayerZero’s token has followed the rest of the market in its retracement. BTC’s performance dragged ZRO back to $2.75 levels earlier today, but it has rebounded by more than 20% in the past few hours.
As of the time of writing, ZRO is one of the few altcoins showing green numbers on multiple timeframes. Additionally, the protocol’s token is showing double-digit gains on both the weekly and biweekly timeframes, with price increases of 40.2% and 22.1%.
Investors are optimistic about LayerZero
Following this, investors and market observers expressed bullish sentiment towards the token. Some traders asserted that ZRO “performed relatively well during the crash” and is now “struggling to recover.”
Crypto trader CryptoKnight highlighted ZRO’s rally and said the token could reach $5 in the short term. Similarly, SpiderCrypto believes ZRO will reach $10 by the end of the year. For market observers, LayerZero is “the best infrastructure company for those who believe in a multi-chain future.”
Despite the launch misstep, users appear to remain confident in the protocol, with some investors considering it one of the “cleanest brands” and its token “easy to market to people who have a bit of FOMO.”
LayerZero Labs recently announced an integration with data-centric blockchain Flare, enabling Flare developers to connect with 75 other networks. According to the post, the integration will connect the blockchain with 50,000 dApps and provide access to “huge new users and sources of liquidity.”
At the time of writing, ZRO is trading at $4.39, having gained 50% in the past 24 hours.
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