Title: ZRO Sees Rapid Shift from Recovery to Distribution as Monthly Unlocks and Weak Sentiment Bite LayerZero’s native token ZRO has flipped from a standout recovery to renewed weakness this month, as recurring token unlocks and fading investor confidence weigh on price action. Quick recap - After the market drawdown on Oct. 6, ZRO was one of the faster-recovering tokens, briefly pushing many holders back to breakeven. - That momentum unraveled: ZRO dropped 12% in a single 24-hour session in its most recent leg down. - From its Oct. 6 peak, the token fell 54% across a roughly 12-week selloff before staging a sharp rebound. - A reversal began in the week ending Dec. 29. Over six weeks through Feb. 16, ZRO surged about 114%, reclaiming prior losses and restoring short-term bullish structure (TradingView). - More recently, price has slipped again—down around 10% over the last two weeks—suggesting sellers are reasserting control. Why the reversal matters Two dynamics appear to be working against ZRO: 1) Recurring monthly supply injections - About 32.6 million ZRO tokens—valued at roughly $52.25 million—are scheduled to unlock on the 20th of each month (CoinMarketCap). The latest such unlock occurred on Feb. 20. - When demand is thin, these predictable inflows can dilute buying pressure and amplify downside moves. The February unlock likely limited bid depth and contributed to the recent underperformance. 2) Distribution and declining participation - On-chain data show a steady contraction in holder count, which intensified after the Jan. unlock; the drop became more pronounced on Jan. 26. Holder addresses now sit at roughly 1.01 million. - Market cap has moved lower in tandem: capital outflows have removed about $109.44 million from the asset in under a month, a sign of capital flight rather than neutral rotation (CoinMarketCap). Sentiment and positioning - Community Sentiment data show bullish conviction fell sharply on Feb. 20—from 88% to 75%—a type of retreat that historically correlates with extended price softness if optimism doesn’t return. - Still, not all participants have abandoned ZRO: CoinGlass reports net spot inflows of $2.67 million over a little more than 48 hours, indicating some buyers are accumulating on the dips and view current levels as attractive. Outlook ZRO sits at a crossroads. Monthly unlocks, falling holder counts and softer sentiment create a bearish tilt and leave the token vulnerable to further volatility. At the same time, steady spot accumulation suggests a subset of traders sees value at lower prices, which could underpin a medium-term rebound if demand intensifies or unlock pressure eases. Disclaimer: This article is for informational purposes only and should not be taken as investment advice. Cryptocurrency trading carries significant risk—do your own research before making any financial decisions. © 2026 AMBCrypto Sources: TradingView, CoinMarketCap, CoinGlass. Read more AI-generated news on: undefined/news