Holland arrests ZKasino founder for crypto ‘exit scam’ while a weak US jobs report gives a boost to Bitcoin

The Dutch tax authorities yesterday arrested one of the founders of the ZKasino platform, an online crypto website that went dark just two weeks after its founding following a suspected “exit scam”. The unnamed 26-year-old man who was arrested is suspected of fraud, embezzlement and money laundering of some 11 million euros.

So happy they have started arresting all the grifters in this space.

This space needs thorough cleaning, starting with the zkasino team.

Grateful to all that made this happen. pic.twitter.com/jS6I949QEL

— King.sol 🇶🇦 (@teddi_speaks) May 3, 2024

An ‘exit scam’ is a way to raise money from investors and then disappear with the funds on launch day.

Crypto Twitter came through to help Dutch police arrest the 26 year old ZKasino scammer (allegedly: @Derivatives_Ape) who allegedly scammed 10,000 investors for $33M in ETH. They seized 11.4M euros (fake money 😂) and real estate, cars, and crypto

SOURCE https://t.co/JhVdgMp8bR

— Autism Capital 🧩 (@AutismCapital) May 3, 2024

Meanwhile, a rather weak US jobs report gave a boost to stock markets and Bitcoin on Friday afternoon. If this is the first sign that the economy is indeed cooling down. It is now possible that the Federal Reserve will cut interest rates after all this year. Earlier this week, something like this seemed to be months away.

ZKasino

The Dutch tax authorities FIOD published the following message yesterday:

“The FIOD arrested a 26-year-old man on Monday, April 29. He is suspected of fraud, embezzlement and money laundering. The investigation focuses on a large-scale scam surrounding the alleged gambling platform ZKasino. Well over 30 million US dollar worth of cryptocurrency has been invested in this gambling platform by victims worldwide. This money is still locked in their crypto currency wallets, which require special keys.”

We are happy to announce that we have closed our Series A at a $350m valuation!

Notable investors (including previous rounds):

• @MEXC_Official
• @BigBrainVC
• @Trading_axe
• @Pentosh1
• @0xSisyphus

A big thank you to our investors for their continued support and belief in… pic.twitter.com/RFn52yqBwT

— ZKasino (@ZKasino_io) March 19, 2024

ZKasino went live on April 20 after months of publishing screenshots of big wins from investing through a bot program. Investors who wanted to participate had to pay in Ether and would receive their investment plus profits some 30 days later. About 10,000 investors decided to join and more than 30 million dollars in investment was raised, also thanks to the marketing of Twitter user ‘Derivatives Ape’, who clearly worked for the platform.

Keep building 🫡 https://t.co/KrhFG8QS7e

— Derivatives Monke (@Derivatives_Ape) April 21, 2024

However, on April 20, the 10,000 Ether invested were immediately siphoned and the text on ZKasino’s website changed. There was no trace of the fact that the deposit would be refunded after 30 days and users had problems logging into the platform. Several of them immediately filed a complaint, after which the Dutch authorities rushed to action.

Interest rate cut

The US economy apparently created far fewer jobs in April than investors expected. The stock markets and Bitcoin responded positively. The largest digital currency quickly jumped back above $60,000 on the news. This is because the weak job report increases the chance of an interest rate cut. It remains to be seen whether we are in for a short bounce of crypto prices over the weekend.