Crypto.com Accidentally Sent $400 Million of Ethereum to Wrong Address, CEO Calls Fears ‘FUD’

after the shock FTX collapseOther centralized crypto exchanges are under scrutiny — and Crypto.com customers are concerned after CEO Kris Marszalek admitted that his exchange mistakenly sent 320,000 ETH, about $400 million at the time, to a public address registered on a rival exchange.

Blockchain Register on Etherscan It showed that on October 21 Crypto.com sent the amount, about 80% of its total ETH reserves, to rival exchange Gate.io on October 22 — right before Gate.io gave.”Evidence of reservesto its users on October 28 as part of a new campaign for transparency in the wake of the FTX crisis.

Gate.io later returned the slightly reduced amount of 285,000 ETH, approximately $456 million as a result of a slight increase in ETH, On October 29. It was just in time for Crypto.com release one Proof of reserves on 12 November.

“It was supposed to be a move to a new cold store address, but it was sent to a whitelisted external exchange address,” Marsalek chirp on Saturday. We worked with [the] Then the gate team and the money were returned to our cold store. A new process and features have been implemented to prevent this from happening again.”

Marsalek in insist on That the address was the corporate account of Crypto.com on Gate. He added that all funds have since been returned and that Crypto.com’s dollar balance on Gate is at “number one” in the millions.

in wire The resulting speculation blew up as ‘FUD’ Marsalek too subscriber Screenshot of Gate showing its reserves as of October 19 with no Crypto.com funds. gate too Posted on his blog late saturday night a”Clarification Regarding Helping Crypto.com to Recover Wrong Transfer of 320K ETH. “

Crypto.com and Gate.io did not immediately respond to inquiries from Decrypt For more comment.

The baffling deal comes days after one of the world’s five largest stock exchanges suffered a catastrophic banking crisis and lacked the cash to cover it, leading to the complete collapse of Sam Bankman-Fried’s empire and reputation.

Like FTX, Crypto.com markets itself as a regulated and trusted crypto company – allegations that many are now suspicious of.

Binance CEO Changpeng Zhao, who sparked the FTX sale a week ago when he tweeted that his company would liquidate its stock of FTX tokens, has criticized Crypto.com’s fiasco.

“If an exchange has to move large amounts of cryptocurrency before or after showing their wallet addresses, that’s a clear sign of trouble. Stay away.”

Crypto.com’s Proof of Reserves, which was released on November 12, was already the subject of some confusion. The document showed that about 20 percent of the exchange’s holdings are denominated in SHIB, the crypto-prank prank based on another joke, DOGE.

FTX Hundreds of millions of dollars Their sports sponsorship deals are quickly fading in the wake of their bankruptcy; The Miami Heat announced Friday that it is giving up the FTX name and is looking for a new naming partner for the stadium. Crypto.com has also spent heavily on sports: it $700 million arena naming rights deal With the Los Angeles Lakers dwarfing the FTX/Heat . deal and trade shepherd FIFA World Cup 2022 in Qatar.

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