Zircuit incurs a TVL loss of 500 million with the initiation of Phase 2 incentive program

CoinWorld reported:
In the past week, users of Zircuit, the second layer network of Ethereum, have withdrawn $500,000 worth of assets from the protocol, and the first phase of its reward program is about to end.
According to DefiLlama’s data, Zircuit’s total value locked (TVL) has decreased from $2.5 billion a week ago to $2.1 billion. Zircuit reached its peak TVL in early May, accumulating $3.5 billion.
The team may hope to reverse the trend of TVL plummeting as they start offering a new round of rewards to users today.
According to Zircuit, the new season brings additional ways to earn rewards, such as deploying and interacting with contracts, as well as sending transactions. It will continue to reward users’ staked assets (including already staked assets) with points.
Zircuit launched its first points activity on February 24, allowing users to hold ETH and Ethereum-based token derivatives in exchange for Zircuitt points, which are expected to make holders eligible for future airdrops, as well as earnings and points from accumulated deposits.
According to Dune’s dashboard, the first season was a success early on, with users depositing over $96 million in stablecoins. Most of these tokens were the controversial USDe from Ethena.
On March 27, Zircuit followed up with its “Build to Earn” program, incentivizing its developer community to build infrastructure, additional tools, or deploy dApps on the Zipuit testnet, which is scheduled to launch in November.
There have been rumors of an upcoming airdrop from Zircuit, but the team has not yet confirmed an exact date. The network is still in the testnet phase. It is worth noting that users can withdraw their deposits from the mainnet at any time.