ZKasino users fuming as $33M in promised refunds are instead sent to Lido

ZKasino, a blockchain gaming platform, has faced criticism on social media X for transferring approximately $33 million in investor and user funds to staking protocol Lido. This shift in strategy marks a departure from their initial commitment to returning the funds.

In a blog post dated April 20th, ZKasino revealed that its network had become operational. Over 10,000 users had transferred approximately 10,515 Ether (ETH) to the platform in anticipation of receiving more ZKasino (ZKAS) tokens as pledged. However, these users now hoped to have their original ETH returns as initially promised.

Instead, changes were made from the original plan and Ethereum bridges were converted into ZKAS tokens at a discounted price of $0.055. This conversion took place under a 15-month vesting schedule.

The company made those adjustments to ensure a smooth transferal process since it doesn’t rely on Ethereum. Previously, its website included a promise to refund the Ethereum, but this pledge has now been eliminated by the update.

After an on-chain transaction revealed that ZKasino transferred a total of 10,515 ETH from its users to the staking platform Lido, these worries became more pronounced.

ZKasino users fuming as $33M in promised refunds are instead sent to Lido

In the meantime, an unidentified crypto expert going by the name “cygaar” alleges that the blockchain ZKasino launched is actually a simplified version of Arbitrum Nitro, which reportedly took only 2 minutes to set up, and contrary to their assertion, they didn’t incorporate zero knowledge technology or EigenDA in its development.

ZKasino users fuming as $33M in promised refunds are instead sent to Lido

Approximately 500 users on X, believed to be from the casino community ZKasino, have recently claimed that the project is a fraud and misappropriated their investments.

Certain individuals have shared the private details, including the name and address of ZKasino’s founder, who goes by the pseudonym “Derivatives Monke,” in an attempt to instigate legal proceedings against him on platform X.

More controversy

Big Brain Venture Capital, in a post on April 21st, fueled the dispute by stating that they have reason to believe ZKasino is dishonest, and clarified that they did not invest in the project. Instead, they were offered a token distribution as part of their investment proportion, which they chose not to accept.

Last month, ZKasino announced on various platforms that they had successfully completed a Series A investment round with a valuation of $350 million. This financing was supported by crypto exchange MEXC, venture firm Big Brain Holdings, and other investors.

ZKasino users fuming as $33M in promised refunds are instead sent to Lido

Simultaneously, TechFlow crypto news site announced on the 21st of April that MEXC stated (translation), “We are merely one of the investors, and ZKasino’s actions do not concern us in any way.” As an investor ourselves, we too have been affected.

Representatives from ZKasino, its founder, ZigZag Labs, and MEXC have yet to provide a response to our inquiries.

During the controversy surrounding X, ZKasino has kept a low profile and merely announced their plan to incorporate EIP-3074.

Monke responded to a criticism from a user about ZKasino’s latest decision, but in another post, he encouraged his project’s progress by sharing the newest update with the caption “keeping busy at work.”

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2024-04-22 08:04