-
Crypto.com faces backlash after reissuing 70 billion CRO tokens once claimed to be permanently burned in 2021, raising allegations of financial manipulation.
-
Blockchain investigator ZachXBT accuses Crypto.com of misleading users and controlling the majority of CRO’s supply, undermining community trust.
-
The platform’s controversial partnership with Trump Media & Technology Group adds fuel to the scandal, raising questions about ethics and credibility.
Crypto.com faces scrutiny after a massive re-issuance of CRO tokens, igniting trust issues among users and concerns about ethical practices.
ZachXBT Slams Crypto.com for Re-Issuing CRO Tokens
ZachXBT, the blockchain sleuth known for exposing scams, took to X (formerly Twitter) to call out Crypto.com’s token re-issuance. The comments came as Crypto.com secured a major partnership with Truth Social, the social media platform owned by Trump Media & Technology Group (TMTG). This move has raised eyebrows.
“CRO is no different from a scam. Your team just reissued 70B CRO a week ago that was previously burned ‘forever’ in 2021 (70% total supply) and went against the community’s wishes as you control the majority of the supply,” ZachXBT expressed.
According to the blockchain investigator, Truth Media would be better positioned to partner with Coinbase or Gemini exchanges or Jesse Powell’s Kraken, among other exchanges, than its collaboration with Crypto.com.
The revelation sparked immediate outrage among the crypto community. Many believed the 70 billion CRO tokens were gone permanently.
The promise of burning these tokens was positioned as a deflationary measure. Specifically, it would help increase the asset’s value and improve investor confidence. Many feel betrayed, accusing Crypto.com of misleading its users for financial gain.
Crypto.com’s decision to re-mint the CRO tokens sparked widespread outrage. The exchange had previously claimed the burn was final, but blockchain records show the tokens have been reinstated. This has caused investors to lose faith in the exchange’s credibility. Many view the move as a blatant manipulation of tokenomics.
A report from Unchained Crypto pointed out that the promise of token burns being “forever” is often misleading. Developers still hold the keys to the smart contracts, potentially allowing them to reverse past burns. In this case, Crypto.com’s actions have confirmed those fears.
“CRO’s out here doing a full 180 like it’s auditioning for The Real Scams of Crypto,” crypto commentator Gem Insider remarked.
Moreover, allegations suggest that Crypto.com CEO Kris Marszalek may have used substantial influence to secure the deal with Truth Social.
“Kris must be lobbying hard,” user Solionxbt commented on X.
Further fueling skepticism, TMTG’s stock soared 9% after announcing the prospective Cronos ETF (exchange-traded fund) partnership. The surge came despite the company reporting a staggering $400 million loss in 2024. This led some to question the ethics of the partnership.
“I remember the good old days when Presidents didn’t grift while in power,” X user SatoadshiLite quipped.
While Crypto.com has yet to issue a detailed response to the allegations, the damage to its reputation may be long-lasting. The partnership with TMTG was expected to boost legitimacy, but now the firm seems overshadowed by allegations of deception and financial manipulation.
Cronos (CRO) Price Performance. Source: COINOTAG
Despite the controversy, Cronos (CRO) price is up by over 30% in the last 24 hours. It was trading for $0.11 as of this writing.
Conclusion
This recent upheaval at Crypto.com highlights the fragile trust in the cryptocurrency ecosystem. With ongoing scrutiny over its practices and the implications of token re-issuance, the exchange must work diligently to restore confidence among its users. Transparency regarding operations and partnerships is essential for Crypto.com to avoid potential long-term reputational damage.
