Renzo’s ezETH depegs to $688 following end of airdrop farming window

Renzo Protocol’s restaked Ether token (EZETH) suffered a price depeg on April 24.

On Uniswap decentralized exchange, the depegging event caused the token’s price to dip down to $688 momentarily, but it later regained its equal value with Ether (ETH) based on Dexscreener’s data.

Renzo’s ezETH depegs to $688 following end of airdrop farming window

According to the anonymous cryptocurrency expert known as Tommy, the occurrence was probably triggered by a larger market sell-off that ensued after the completion of Renzo Protocol’s season 1 airdrop in late April.

“Sell-off likely caused by the conclusion of Season 1 Airdrop, users want to get back $ETH to farm other [liquid restaking tokens] LRT/protocols.”

The second largest decentralized finance (DeFi) platform for staking liquids, Renzo, holds a total value of approximately $3.3 billion, marking a significant increase of 126% in the past month., being the largest such platform, boasts a TVL of around $3.9 billion as per DefiLlama’s latest reports.

Liquid rebalancing tokens (LRTs) are experiencing more frequent disruptions, a concern frequently raised by cryptocurrency experts.

“On the depeg, it is a risk that we need to recognize for all LRTs, even if withdrawal is enabled, the DEX pool can still depeg simply based on the temporary imbalance.”

A decoupling event caused widespread sell-offs in leveraged platforms such as Gearbox and Morpho Labs. Users relying heavily on LRTs as collateral for borrowingETH faced significant financial losses, as reported by the analyst.

The addition of Renzo protocol’s token (REZ) to Binance’s launchpool on April 23 has generated more attention towards the protocol, following their announcement of an upcoming airdrop on the same day.

Renzo allocated 10% of its token allocation to the season 1 airdrop.

Trader profits nearly $400,000 in two hours on ezETH depeg

Crypto trader czsamsunsb.eth made a profit of 121.65 ETH, worth over $396,000, in just two hours after Renzo’s depegging incident, according to on-chain intelligence firm Lookonchain, that wrote in an April 24 X post:

“czsamsunsb.eth made 121.65 $ETH in just 2 hours after $EZETH (Renzo Restaked ETH) depegged! He spent 4,099 $ETH to buy 4,221 $EZETH successfully, making 121.65 $ETH!”

Renzo’s ezETH depegs to $688 following end of airdrop farming window

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2024-04-24 17:00