ZKC's 70% Single-Day Rise: Analysis of Airdrop Controversy and Regulatory Warnings

Key Points

Boundless (ZKC) did experience significant price growth between October 16th and 17th, rising from a low of $0.179 to a high of $0.309, a 72% increase and a 24-hour gain of approximately 59-70% . However, this rebound occurred amidst an investment warning from South Korean regulator DAXA, the suspension of deposit services by Upbit, and controversy surrounding its airdrop distribution. The current price of $0.294 remains approximately 84% below its September 15th launch high of $1.78.

Price Performance Analysis

Market data (October 17, 2025, 08:34 UTC)

The price rebound was mainly concentrated in the afternoon of October 16 and the early morning of October 17, coinciding with high trading volumes during the Asian and European trading sessions.

Technical Analysis Insights

Short-term trends :

• RSI(14) rebounded from the oversold range of 21.35 to 73 (overbought on the 4-hour chart)
• The MACD is showing a strong bullish signal, with the histogram expanding to +0.014.
• The price broke through the upper Bollinger Band ($0.286), indicating strong momentum.

Key support/resistance levels :

Derivatives Market :

• Open interest surged 187% to $35.6 million in 24 hours
• Funding rates are negative (Binance -0.48%), with shorts paying longs.
• $2.39 million liquidated in 24 hours, with short positions losing even more ($1.33 million)

Detailed explanation of the airdrop distribution controversy

Airdrop mechanism and distribution issues

Allocation structure :

• Total airdrop : approximately 60 million ZKC (6% of total supply)
• Binance HODLer Airdrop : 15 million ZKC (for BNB holders from September 2-5)
• Kaito Platform Distribution : Community Sales, based on Twitter Engagement Rankings

Main points of contention

1. Selling pressure and retail investor losses

• On the first day of listing on September 15, a massive sell-off by airdrop recipients caused the price to plummet 75% from $1.79 to $0.44.
• On-chain data shows 78,731 transactions, with 605 million ZKC (approximately $600 million worth) flowing into exchanges.
• Users who acquired tokens at zero cost profited at the expense of retail investors, sparking accusations of “pump and dump”

2. Kaito ranking distribution issue

• Twitter's engagement rankings are being manipulated by bots and large accounts, according to accusations of manipulation.
• Technical glitches: High Ethereum gas fees and delays prevented some users from claiming/exchanging tokens during periods of volatility
• On September 16, Kaito announced refunds for affected users, but complaints persisted.

3. Lack of transparency in token economics

• High inflation (7% initially, gradually decreasing to 3%) was criticized as a "continuous sell-off"
• The risk of "unlimited casting" under the PoVW mechanism is similar to the Ponzi scheme
• Allegations of team/insider sell-offs via airdrops or hidden wallets (unverified on-chain)

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Regulatory warnings and trading restrictions

DAXA Investment Alert Details

Important events on October 2, 2025 :

• The Korean Digital Asset Exchange Association (DAXA) has listed ZKC as a “precautionary trading project”
• Upbit immediately suspends ZKC deposit services (effective at 20:30 Beijing time)
• Trading continues but with a risk warning. The review period ends on October 17.

Regulatory focus

Circulation plan differences :

• The actual circulating supply exceeds the project's original disclosure
• Continuous minting under the PoVW mechanism is considered a dilution risk
• Lack of transparent communication of token economics updates

Lack of transparency :

• Key changes were not proactively reported to the exchange
• Inadequate justification of governance and provisioning plans
• Delay in responding to exchange inquiries

Other exchange status

Other major exchanges around the world were not affected, and the regulatory issues were limited to the Korean market.

Community sentiment analysis

Main narrative themes

Bearish sentiment prevails :

• Community discussions mainly focus on the price plunge after launch rather than the recent price increase
• Early holders expressed disappointment with the drop from $1+ highs to current levels
• Airdrop recipients face severe losses, which is called a "web3 lesson" for novices

Airdrop winners and losers differentiated :

• Some users shared their success stories of earning $16,000-$18,000 from airdrops.
• Users who chose to stake rather than sell now face magnified losses
• Regret for missing out on selling is widespread

DAXA Controversy Response :

• The community views regulatory warnings as FUD exacerbating price woes
• Official response emphasizes transparency efforts and lack of operational risk
• Doubts persist about whether the resolution can restore trust

Key Sound Analysis

• Bearish/skeptical : Personal experience of loss and warnings about the mortgage trap, with a regretful and educational tone
• Neutral/Information : Official and analytical accounts provide factual explanations of DAXA issues, combating FUD through verifiable changes.
• Bullish (limited) : Focuses primarily on airdrop profit sharing and lacks direct response to controversies

Technology Outlook and Risk Assessment

Short-term outlook

Bullish factors :

• Oversold RSI bounce signal
• Negative funding rates indicate short pressure
• A 187% surge in holdings indicates new capital inflows

Bearish risk :

• 4-hour RSI reached 73, which is in the overbought range.
• Daily OBV and CMF are negative, indicating long-term distribution pressure
• DAXA review results uncertain

Medium- and long-term challenges

Fundamental risks :

• 7% initial inflation rate continues to dilute holder value
• The Korean market accounts for 12% of liquidity, with potential delisting risks
• Token economics transparency issues are not fully resolved

Technical support :

• ZK computing infrastructure has long-term value
• Ethereum Foundation and EigenLayer support enhanced trustworthiness
• Mainnet operation is stable, and TVL has increased to $174M

Conclusion and Outlook

ZKC's 68-70% daily gains did occur, but should be interpreted as oversold rebounds rather than improving fundamentals. The 124% price rebound from the October low of $0.13 was primarily driven by technical factors, including a short squeeze and derivatives momentum.

Key risks :

• Regulatory uncertainty (DAXA review findings)
• Continued airdrop selling pressure
• High inflation token economics model

Opportunity factors :

• ZK track's long-term growth potential
• Oversold technical indicator repair
• Institutional staking locks supply

Investors should closely monitor DAXA's decisions after October 17th, as well as the team's improvements to transparency and token economics. In the short term, the token is likely to fluctuate between $0.21 and $0.32, with long-term value dependent on technological adoption and regulatory resolution.