- ZKasino has offered to let investors claim their Ether deposits back.
- The move comes after Dutch police arrested a man in connection with ZKasino on May 3.
Crypto gambling platform ZKasino, which was accused by Dutch authorities of vanishing with some $30 million in user deposits last month, says investors can apply to get their funds back.
“We are now initiating the 2-step bridge back process in which bridgers can sign up and bridge back their ETH at a 1:1 ratio,” ZKasino said in a May 28 blog post.
The move comes after Dutch police arrested a 26-year-old man suspected of fraud, embezzlement and money laundering in connection with ZKasino on May 3.
Dutch authorities also said they had seized €11.4 million worth of various assets, including real estate, a luxury car, and various cryptocurrencies.
The sudden turnaround, coupled with no communication with Dutch authorities, has left many questioning if the offer is legitimate.
“They can send all our ETH back without playing these games,” Mick1794, a ZKasino investor, said in the ZKasino Legal Task Force Telegram — a messaging app.
Additionally, ZKasino said investors only have 72 hours to sign up.
“After three days, the ability to sign up is closed and deposits are halted,” the ZKasino post said.
This relatively short period investors have to sign up to get their funds back could mean many who thought their funds were gone will miss out.
In March, ZKasino and its founders announced a programme called Bridge-to-Earn, offering users a chance to lock up their Ether temporarily to earn rewards.
But when it came time to redeem a month later, ZKasino suddenly changed the rules and kept some $30 million worth of deposits.
Both investors and Dutch authorities accused ZKasino of running off with the funds.
Scam allegations
Despite Dutch authorities asserting that ZKasino is a scam, the project has always maintained that it is legitimate.
“We have initiated the process for bridgers to bridge back their ETH for those who choose not to be part of the ZKAS conversion,” ZKasino said in its blog post, without acknowledging the accusations.
Those who bridged Ether as part of ZKasino’s Bridge-to-Earn programme can now deposit the ZKAS tokens they received in return to get their Ether deposits back.
“Signing up forfeits the remaining 14 months of ZKAS release,” the post said.
The post however, made no mention of the Ether staking rewards that ZKasino earned on users deposits.
Onchain records show ZKasino has converted investors’ Ether to Lido’s Wrapped Staked Ether shortly after the end of the Bridge-to-Earn programme on April 20.
At the current Lido staking yield of 3.3%, combined with Ether’s recent rally, the staking rewards accrued by ZKasino are worth over $100,000.
Tim Craig is a DeFi Correspondent at DL News. Got a tip? Email him at tim@dlnews.com.