ZKasino Promises Refunds Amid Skepticism from the Community
By: Eliza Bennet
ZKasino, a Decentralized Finance (DeFi) platform recently embroiled in significant controversy, has announced its intention to return stolen funds to its investors at a 1:1 ratio. The announcement follows charges from Dutch authorities accusing ZKasino of stealing $30 million in user deposits.
The platform stated in a blog post on May 28 that investors can reclaim their Ethereum (ETH) through a newly introduced '2-step backbridge process.' This move follows the arrest of a 26-year-old Dutch man, linked to ZKasino and charged with fraud, embezzlement, and money laundering. Dutch authorities have seized assets worth €11.4 million, including real estate, a luxury car, and various cryptocurrencies.
Skepticism Remains High
Despite ZKasino's commitment to refunds, skepticism among investors remains high. The lack of direct communication with Dutch authorities and the sudden refund offer have raised several doubts within the community. Chief among them is the short 72-hour window provided to investors to sign up for the refund process. Many fear this brief period may prevent timely recovery of their deposits, adding to the concern that the refund process could itself be a scam.
The platform's blog post did not address the staking rewards earned from user deposits. Onchain records suggest that ZKasino converted investors' ETH into Lido's Wrapped Staked Ether. Considering the current Lido staking yield of 3.3% along with a recent rally in ETH prices, the staking rewards generated are estimated to be over $100,000.
Several community members have questioned why investors must undergo another process instead of simply having their Ethereum returned. Additionally, doubts are raised about the veracity of the blog and associated social media posts, particularly given that the developer behind the pseudonymous ZKasino account, known as 'Derivatives Monke,' is reportedly in jail.
The Zkasino Scam
ZKasino's issues began in March with the launch of its 'Bridge-to-Earn' program, which promised rewards for temporarily locking up ETH. However, when the redemption period arrived in April, the platform withheld approximately $30 million in deposits, prompting allegations of fraudulent activity from both investors and Dutch authorities.
While ZKasino maintains it operates legitimately, a combination of legal issues, investor skepticism, and the recent refund announcement has left many questions unanswered. As the 72-hour deadline approaches, the crypto community is closely monitoring whether ZKasino will honor its promises or if further complications will arise.
