The decentralized lending protocol ZeroLend has announced the cessation of its activities after three years of operation. The primary reason for the closure was prolonged operational losses, a sharp decline in liquidity, and unfavorable conditions within the ecosystem. The platform’s founder, using the pseudonym Ryker, stated that the project was unable to restore a sustainable economic model amid increasing pressure from hackers, the cessation of oracle support, and the illiquidity of certain networks.
This is reported by Business • Media
Critical Decline in TVL and Financial Difficulties
According to DefiLlama, the total value locked (TVL) in ZeroLend has decreased by 98%. While in November 2024 the TVL exceeded $359 million, it currently stands at only $6.6 million. Liquidity remains distributed among networks such as Linea, Ethereum, ZKsync Era, as well as other second-layer ecosystems.
The project’s financial performance has significantly deteriorated: after generating over $1 million in profit in 2025, gross revenue in the current period has fallen to several hundred thousand dollars. ZERO token holders have not received any revenue distribution, and the token itself has lost nearly all of its value.
“The protocol operated at a loss for an extended period and was unable to restore a sustainable economic model.”
Withdrawal of Funds and Next Steps for Users
The ZeroLend team has urged users to withdraw their funds immediately. A zero LTV ratio has been established on most markets to ensure the safe closure of positions. For assets placed in the Manta, Zircuit, and xLayer ecosystems, a separate recovery mechanism is being prepared through smart contract updates. There are also plans for the redistribution of liquidity that remains in inactive pools.
Additionally, the team is working on the return of LBTC user assets on the Base network following the security incident in 2024. Part of the compensation will be provided from resources obtained through the LINEA airdrop.
For ZERO token holders, no recovery mechanism is provided: according to CoinMarketCap, its value has decreased by 41% in just the last day, and from the peak values of 2024, the token has nearly completely depreciated.
