The latest development shows that Dutch authorities arrested a suspect in the Netherlands and more than $12 million was confiscated in the process.
About two weeks ago, the crypto space faced another alleged pullback. This time, blockchain casino and gambling platform ZKasino was at the center of the accusations, with many investors claiming they had run out of money.
Despite the accusations, ZKasino continued publishing X updates before disappearing from the public eye with investors’ money.
Alleged Cryptocurrency Scammer Arrested
The Netherlands’ Tax Information and Investigation Service (FIOD) revealed on Wednesday that a 26-year-old man had been arrested earlier this week for pulling the ZKasino rug.
According to the press release, Dutch authorities began investigating the $33 million crypto gambling platform scam on April 25. The criminal investigation began with online reports from the crypto community and information from FIOD intelligence departments. Staff from Binance’s Financial Crimes Compliance team assisted FIOD during the investigation, helping to “secure millions of euros in cryptocurrency.”
Likewise, the Prosecutor’s Office helped the investigation team contact the members of the ZKasino Team. On April 29, FIOD arrested a man suspected of “fraud, embezzlement and money laundering.”
The suspect’s detention was extended to fourteen days for “investigation purposes” after being brought before a magistrate. As part of the investigation, authorities searched the suspect’s home and confiscated around €11.4 million, worth approximately $12.25 million, in various assets.
The FIOD seized real estate, luxury cars and various cryptocurrencies. Dutch authorities are not ruling out further arrests, as the cooperation of the fraudsters involved will be required to recover and return the stolen money to the victim.
ZKasino, A Scam from the Start?
Crypto betting platform scam rumors began in March when decentralized exchange (DEX) ZigZag made serious accusations against the project. According to the rival crypto exchange, ZKasino had not paid developers and other contractors who helped build the platform.
Additionally, ZigZag claimed that the project’s fundraising and valuation were likely fake. The post added that the previously announced $40 million ecosystem was not real and would likely never be paid in real currency.
Even though alarm bells were ringing, trust in the crypto project did not completely crumble until April 20. Users began reporting suspicious activity after the website began showing changes. An X user noted that previously the platform section “How does Brid-To-Earn work?” stated that the Ethereum bridge would be returned to investors when the chain and its native token, ZKAS, were active. However, this part of the text was supposedly removed.
ZKasino led investors to believe that they would recover their investments within 30 days. The team had promised the ability to withdraw their 1:1 bridged Ethereum. Instead, users discovered that their funds were locked in ZKAS with a vesting period of 15 months.
Concerns increased when the bridge became inaccessible after the chain came into operation. The team later stated that it was “down for maintenance and will be reworked alongside this release.”
The project’s X account continued to post updates until April 24, when it announced that Bridge was active again. Despite user complaints about stolen funds, the post adds that users can “transfer their $ZKAS from the ZKasino chain to Ethereum and the like.”
After this final email and the lack of attention to the situation, users confirmed their suspicions that they had been rude. The FIOD investigation noted that ZKasino’s promises should never have been fulfilled, as the smart contract setup suggests that the fund’s “return was not as anticipated.”
By Leonardo Perez
