ZKasino, a blockchain-based gambling project, has faced allegations of conducting a $33 million “rug pull.” To address these concerns, the project has initiated a 72-hour “2-step bridge back process” to return funds to investors. In a Medium post on May 28, ZKasino announced the start of the refund process, allowing investors to participate in the bridge back process with a 1:1 ratio for bridging back their Ethereum (ETH). The project aims to reassure investors that they are committed to delivering and working hard to make the project successful.
The refund process involves investors sending back their complete ZKasino (ZKAS) token balance from the original address where they initially invested their Ether. Once a data verification process is completed, a claim portal will be opened for investors to facilitate the refund process. However, investors who choose to receive their ETH back will forfeit any allocated ZKAS tokens and the remaining 14 months of the ZKAS release. Some investors have raised concerns about the 72-hour window for the bridge back process and the legitimacy of the sign-up page, fearing it may be a potential scam or wallet drainer.
It is important to note that the Medium post announcing the refund process was not shared by ZKasino’s official account but by “Derivatives Monke,” the ZKasino builder at the center of the controversy. ZKasino faced severe criticism last month for failing to return investor ETH after the network went live. Instead, approximately $33 million worth of funds were sent to Lido for staking, causing accusations of an “exit scam.” Following the incident, Dutch authorities arrested an individual suspected of involvement in the rug pull on April 29, and around two-thirds of the stolen funds were returned to the ZKasino multisig wallet.
In April, the cryptocurrency industry experienced a decrease in combined losses from hacks and scams. The month recorded the lowest combined losses from crypto-related hacks and scams since 2021, with approximately $25.7 million lost to exploits, hacks, and scams. Flash loan attacks resulted in $129,000 in losses, with the largest incident causing $55,000 in damages. Exit scams accounted for $4.3 million in losses, marking a decrease in the incidence of such attacks since February 2022. The first quarter of this year saw $336 million lost to Web3 hackers and fraud, with nearly half of the capital stolen in January alone.
Overall, ZKasino’s response to the allegations of a rug pull through the implementation of a refund process aims to address investor concerns and restore trust in the project. The decision to initiate a bridge back process and return funds to investors at a 1:1 ratio demonstrates a commitment to transparency and accountability. As the cryptocurrency industry continues to navigate challenges related to hacks and scams, it is essential for projects to prioritize security measures and maintain open communication with their investor community to foster a sense of trust and credibility.
