Zircuit Loses Half a Billion in TVL as Phase Two of Rewards Program Kicks Off

Users of Zircuit, an Ethereum Layer 2 network, have pulled out half a million dollars in assets from the protocol just in the past week, as phase one of its rewards program wraps up.

Zircuit’s Total Value Locked dropped to $2.1 billion from $2.5 billion a week ago, according to DefiLlama. Zircuit enjoyed its peak in TVL in early May, when it amassed $3.5 billion.

The team likely hopes to buck the plummeting TVL trend as it starts a new round of rewards for its users today.

According to Zircuit, the new Season brings additional ways to earn rewards, such as deploying and interacting with contracts, and sending transactions. It will continue to reward users with points for staked assets, including assets that were already staked. s.

Points Campaign

Zircuit launched its first points campaign on Feb. 24, allowing users to stake ETH and Ether staking derivatives in exchange for earning Zircuit Points — which are expected to qualify holders for a future airdrop — in addition to the yield and points accumulated by the deposited assets.

Season 1 was an early success, with users depositing more than $96 million in stablecoins, according to a Dune dashboard,. Most of those tokens are Ethena’s controversial USDe.

On March 27, Zircuit followed up with its “Build to Earn” program, incentivizing its community of developers to build infrastructure, additional tools, or deploy dApps on Zircuit’s testnet which went live in November.

Rumors of an upcoming Zircuit airdrop have been floated, but the team has not set a definitive date. The network is also still in testnet. Notably, users can withdraw their pre-mainnet deposits whenever they wish.