ZKasino, a crypto project that had gained attention with its $350 million valuation and the backing of investors like MEXC, Big Brain Holdings, Trading Axe, Pentoshi and 0xSisyphus.
ZKasino, a crypto project that had gained attention with its $350 million valuation and the backing of investors like MEXC, Big Brain Holdings, Trading Axe, Pentoshi and 0xSisyphus, found itself embroiled in turmoil following the launch of its mainnet and token, ZKAS. The project, which had initially promised participants the option to redeem their bridged ether 1:1, while farming ZKAS tokens, shocked investors by automatically vesting the funds into $ZKAS tokens instead. Over $33 million in ETH were bridged to the network.
Prior to the launch, ZKasino had faced warning signs and allegations of mismanagement. Accusations of stolen funds from ZigZag's treasury and unpaid contractors were raised by blockchain sleuth ZachXBT against the project's team. Additionally, ZKasino's founder, known as Derivatives Monke, had stirred controversy with a graphic video and sarcastic remarks, later issuing an apology.
When the protocol finally went live after multiple delays, investors were taken aback by the sudden change in plans. Instead of the promised ether refunds, their funds were converted into $ZKAS tokens, with a claim that it was done to “provide a seamless transition and a superior user experience.” However, users revolted against this decision, pointing out alterations to ZKasino's website that had removed references to ether refunds. Furthermore, the vesting period for $ZKAS tokens was extended to fifteen months, fueling allegations of a rug pull. Thousands of investors expressed their anger and frustration, sharing personal information about Derivatives Monke as they sought to recoup their capital.
Token launchpads Ape Terminal and AIT Launchpad canceled ZKasino's Initial DEX Offering (IDO), while MEXC removed the listing of $ZKAS from its exchange. The $33 million worth of ETH was deposited into the staking platform Lido, in a move that was not announced by the team.
This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators.
This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice.
The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap.
