Critics are voicing disapproval towards Crypto.com as they’ve re-created approximately 70 billion Cronos tokens that were previously burned in 2021, an action seen as contradicting the values of decentralization and openness within the cryptocurrency world.
As a researcher delving into the intricacies of the cryptocurrency world, I found myself at the heart of a heated debate that ignited on March 25th. This flare-up was sparked by an onchain investigator named ZachXBT who shared findings on a platform, accusing Crypto.com of resurfacing Cronos (CRO) tokens that were previously marked as permanently removed from circulation. In his words, “CRO is no different from a scam.” He further claimed that the resurfaced tokens accounted for a significant 70% of the total supply, a revelation that contradicted the community’s anticipations and raised concerns about transparency.
He noted that your team recently issued 70 billion CRO, which had been permanently destroyed back in 2021 (making up 70% of the total supply). This action goes against the expressed desires of the community, given that your team holds a significant portion of the supply’s control.
After hearing that Trump Media had entered into a non-binding deal with Crypto.com, the reissuance took place – this agreement aimed to facilitate the launch of United States crypto exchange-traded funds (ETFs) via Crypto.com’s broker-dealer, Foris Capital US.
It’s unclear to me why Truth would prefer a collaboration with your exchange instead of Coinbase, Kraken, Gemini, and others, following the decision made by your team.
Increasing the number of a token available for circulation could potentially lower its value as more tokens are now chasing the same demand, causing the price to drop according to basic economic principles of supply and demand.
Crypto.com CEO responds to backlash
In response, Kris Marszalek, CEO of Crypto.com, stated that this action was essential to foster growth in investments under the recent political changes in the U.S. He explained during a live Q&A session on X on March 25th, “Cronos and Crypto.com have been operating independently for quite some time.
“The original token burn from Q1 2021 was a defensive move. At that point in time, it made a lot of sense. Now we have strong support from the new administration, the war on crypto is over […] There’s a need for an aggressive investment to win.”
He continued by stating, “This is what the community desires; it’s as if we are considering pennies instead of dollars.
Concerns about governance and decentralization
There are worries among critics that the procedure for re-issuing votes could potentially be tampered with or rigged.
According to a report by CryptoMoon on March 19th, GitHub users alleged that the validators for the exchange possess around 70% of the voting influence on the blockchain. This empowers them with the authority to reverse decisions made within the community.
Based on information from Laura Shin’s Unchained, it is alleged that Crypto.com holds approximately 70% to 80% of the overall voting power. This effectively eliminates the requirement for any governance vote, as they hold a significant controlling stake.
On March 19, Marszalek addressed X, emphasizing the company’s financial and regulatory steadfastness in light of the persistent uproar surrounding the controversial re-issue of the 70 billion Cronos tokens.
In a blog post that was later removed, Crypto.com announced a massive token burn of 70 billion CRO tokens, claiming this was the largest token burn ever recorded, with the intention of fully decentralizing the network upon the launch of the CRO mainnet.
As a researcher eagerly anticipating the upcoming mainnet launch of the CRO chain, I’m thrilled to announce that we are embarking on a significant step towards decentralization – immediate token burning of 59.6 billion tokens, aligning with our core principles.
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2025-03-25 12:25