zkLend, a lending platform built on Starknet, has announced it will cease operations. The decision follows a crippling $9.5 million exploit in February 2025, leaving the platform’s reputation in tatters. With its remaining $200,000 treasury now redirected to a user recovery fund, zkLend’s closure marks another casualty in the volatile DeFi landscape.
zklend Sunsets Business Operations
zkLend’s downfall began with a massive security breach that resulted in the loss of $9.5 million in crypto assets, one of the largest hacks on Starknet. The stolen funds were funneled through privacy protocol Railgun, and despite the DeFi lender’s offer of a 10% bounty to the hacker, user trust plummeted. The delisting of zkLend’s native token, ZEND, from major exchanges further eroded liquidity, sealing the platform’s fate.
The team, heartbroken, decided to wind down operations rather than attempt a relaunch. The $200,000 left in the treasury will now fund a user recovery program, aimed at compensating those impacted by the hack.
zkLend’s DeFi Spring, recovery, and kSTRK portals, however, will stay open, allowing users to unstake or claim remaining funds. The platform also plans to open-source its audited codebase, inviting developers to contribute to its ongoing work.
Who Was Affected?
The zkLend hack left countless users reeling, with many losing significant investments. Small retail investors, who relied on the DeFi lender’s Artemis lending product for passive income, were hit hardest. Also, institutional clients using the Apollo platform were affected.
Social media posts on X reflect widespread disappointment, with users lamenting the loss of trust in DeFi. The DeFi lender’s closure joins a grim list of recent DeFi failures.
For example, in March 2025, a massive whale cunningly schemed to drain the Hyperliquidity Provider (HLP) of $12 million. The mastermind behind the heist had an enormous stash of 124.6 million JELLY tokens, valued at $4.85 million, which it used to make a calculated strike on the Jelly market. These incidents highlight the persistent security risks in DeFi, where faulty code and exploits have resulted in billions of dollars in losses.
As zkLend fades, its team remains committed to pursuing the stolen funds, working with security firm zeroShadow to track recoveries for the user fund.
