Are the Customer Funds Safe on Crypto.com?
CEO of crypto.com, Kris Marszalek in an interview wants to let everyone know that his company is in safe hands.
It's understandable as the crypto market have been going through some rough days for much of the year with big names going bankrupt.
Last month when FTX failed just after the statement from Sam Bankman Fried, that the crypto exchange's assets were fine, trust across the crypto industry was damaged.
Credits: Bloomberg
Marszalek assured the clients that their funds belongs to them and are available readily, in contrast to FTX, which according to court filings and legal experts, used client money for all kinds of risky and supposedly fraudulent activities.
SBF has denied knowing about any fraud. FTX clients are now out of billions of dollars while the bankruptcy proceedings are going on.
After the collapse of FTX, crypto.com published its unaudited partial proof of reserves. According to the release nearly 20% of customer funds were in Shiba Inu, the meme coin which is an amount overshadowed only by its bitcoin allocation. According to Nansen Analytics, that percentage dropped to about 15% since the initial release.
On December 09, 2022, crypto.com released an audited Proof of Reserves attesting that customer deposits are 100% backed by crypto.com reserves.
While there is no such evidence emerged yet of wrongdoing at crypto.com, Marszalek's business history is full of red flags. A judge called Marszalek's testimonial unreliable after the collapse of his prior company back in 2009.
Marszalek as a businessman has a history of being involved in a multimillion dollar settlement over claims of defective products, corporate bankruptcy and an e-commerce company that collapsed shortly following a blowout marketing campaign that prevented sellers from accessing their money, according to CNBC.
Follow: @howzat
www.twitter.com/itshowzat
Discord: howzat#8307
Posted Using LeoFinance Beta
Posted Using LeoFinance Beta
The answer is nothing is safe on a centralized exchange. There is always counterparty risk.
Posted via
Veews
I don't trust any audit because the audit can be done by someone in the metaverse. In a way, I think the only trustworthy one would be coinbase because it's publically traded and they have some duties to make sure they are doing what they say they are.
Posted Using LeoFinance Beta