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ZKasino resurfaces with promises to return investors’ funds, but skepticism abounds
ZKasino, a DeFi platform recently embroiled in controversy, announced that it will return stolen funds to its investors at a 1:1 ratio.
The platform, which Dutch authorities recently accused of stealing $30 million from users’ deposits, said in a blog post on May 28th investors will be able to claim theirs Ethereum (ETH) through a recently introduced “2-step backbridge process”.
The announcement comes after the arrest of a 26 year old Dutch man linked to ZKasino in early May on charges including fraud, embezzlement and money laundering. The man is reportedly behind the pseudonymous ZKasino developer’s X account called “Monke Derivatives.”
Dutch authorities have seized assets worth 11.4 million euros, including real estate, a luxury car and various cryptocurrencies.
Skepticism remains high
Despite ZKasino’s commitment to refunds, investor confidence remains low. The lack of direct communication with the Dutch authorities and the sudden refund offer have raised several doubts in the community.
Chief among these is that the platform has given investors a 72-hour window to sign up for the redemption process. Skeptics say this short period could prevent many from recovering their deposits and could be another scam intended to drain people’s wallets.
The platform’s blog post did not address staking rewards earned from user deposits. Onchain records indicate that after the end of the Bridge-to-Earn program, ZKasino converted investors’ ETH into Lido’s Wrapped Staked Ether.
Given Lido’s current staking yield of 3.3% and the recent ETH price rally, the generated staking rewards are estimated to be over $100,000.
Several community members have wondered why the platform asks them to go through another process instead of just returning the Ethereum.
Others questioned the veracity of the blog and associated social media posts, asking how Derivatives Monke was tweeting about reimbursement from the confines of prison.
The Zkasino scam
The problems with ZKasino began in March, when the platform launched the “Bridge-to-Earn” program, promising rewards for temporarily blocking ETH.
However, when the redemption period arrived in April, ZKasino retained approximately $30 million in deposits, leading to allegations of fraudulent activity by both investors and the Dutch authorities.
ZKasino claims to be operating legitimately, but the 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 deliver on its promises or whether further complications will arise.