Currently, Beosin KYT has monitored the relevant addresses and issued warnings for all address activities as soon as possible.
Cover: Photo by Osman Rana on Unsplash
*Most of the content is based on the report of Odaily and has been authorized
On April 21, Beijing time, amid many discussions about the suspected absconding of the Rug project, the decentralized betting platform ZKasino, which had previously attracted 10,515 ETH (approximately 33.2 million US dollars) through a bridge reward event, deleted the refund description mentioned on the official website event page . The project party first transferred the ETH assets deposited by users to the 0x791 multi-signature address, and then deposited it into the staking agreement Lido for interest .
From a star project with a $350 million Series A valuation to a high-risk Rug project with FUD on the entire network, ZKasino took less than a month . Today, Beosin will analyze this soft run storm involving more than $33 million through KYT.
1. ZKasino’s team and background, is it just a cover-up?
Team + narrative are the reasons why ZKasino was able to gain high market attention in a very short period of time, but what users who participated in the platform's bridge reward activities did not expect was that the project party chose to do evil after facing such a huge amount of deposits.
Team background: Zigzag founding members
The personal Twitter accounts of the two founding members of ZKasino are Prometheus and Derivatives Monke. The two had previously participated in the well-known DEX project Zigzag Exchange on zkSync, which had raised $15 million. The project experience gained from participating in mature projects has made many users have high hopes for the two, and thus established a certain degree of trust in ZKasino.
On March 19, ZKasino announced the completion of its Series A financing with a valuation of US$350 million, with participation from MEXC, Big Brain Holdings, Trading_axe, Pentoshi and 0xSisyphus. In this way, with a mature team and impressive financing, a "star project" began its performance.
Top narrative: From decentralized betting platforms to on-chain gaming Layer 2
ZKasino established itself in the market as a decentralized betting platform when it was first launched. Previously, the platform has launched gambling games and lottery events many times, and supports betting on multiple networks including Polygon and Arbitrum.
On March 12, ZKasino announced that after 10 months online, the ZKasino platform had a total profit of US$6.9 million, the total number of users exceeded 35,000, the total number of bets exceeded 6.9 million, the total bet amount exceeded US$390 million, and it will launch its own super chain, "so that anyone can deploy a gaming platform like ZKasino."
Since then, ZKasino has transformed itself and successfully achieved a narrative shift from a gambling platform to a gaming ecosystem.
On March 16, ZKasino announced that the ZKasino bridge will be launched soon, and users who participate in the fund bridging activity will receive ZKAS token rewards. Subsequently, ZKasino has issued several articles, not only stating that the earlier users deposit funds, the more token rewards they can receive, but also launching a rebate mechanism to encourage users to invite more people to join .
On April 5, ZKasino officially tweeted that the bridge deposit funds have exceeded 10,000 ETH.
On April 11, ZKasino announced that it will soon launch the IDO platform Ape Terminal.
Rug signal: Risk capital participation, arbitrary change of platform rules
On April 20, ZKasino deleted the sentence "Ethereum will be returned and can be bridged back at this point." from the Bridge funds introduction on its official website. Users who were late to the party checked whether their deposited funds could be withdrawn, but the result was obviously disappointing. At this time, the last update of the ZKasino official account was 4 days ago. For a time, the news that the ZKasino project Rug had run away gradually spread.
By checking the ZKasino deposit contract address through Beosin KYT, it can be found that a large amount of funds related to gambling and blacklist addresses are deposited into its contract address in an attempt to launder funds. When institutions or users conduct due diligence on projects, or when projects themselves conduct fund risk control, they should pay attention to whether there is an inflow or outflow of high-risk funds.
2. Event Progress: IDO Cancelled, Investment Institutions Speak Out
What was originally a good operation activity of "I deposit money and exchange it for your platform tokens" was turned into a "Crypto honeypot" where "you can only enter but not exit" by ZKasino. While countless excited users were waiting for the official response of ZKasino, they also transferred their anger to the previous IDO platform and investment institutions and questioned them.
Listing Exchange: Cancel the ZKasino Listing Plan
On April 20, MEXC Exchange announced the cancellation of the launch of ZKasino (ZKAS). This was also seen by many as a major reason for the ZKasino project Rug to run away, causing FUD to intensify.
IDO Platform: Pay close attention and refund later
On April 21, Ape Terminal stated that due to the recent situation of ZKasino, its IDO has been cancelled; all participants will be refunded and stablecoin claims are now online.
3. Latest progress: The project continues, but there is no explanation for where the funds went
As of the time of writing, ZKasino’s official statement mainly includes the following:
(1) The ZKasino network will still be launched, but exchange listing will be delayed.
(2) All ZKasino games will be ported to the new chain - they will remain on Arbitrum and Polygon. Native DEX and stablecoins will be launched soon. The first batch of ZKAS tokens will also be distributed to bridge event participants.
(3) The Zkasino chain will integrate EIP-3074 when it goes live.
However, ZKasino has not mentioned the whereabouts of the funds previously deposited by users and the subsequent arrangements.
Looking at the relevant addresses of this incident, the ZKasino project uses new addresses, one of which is used to withdraw funds from the Binance exchange. If the subsequent ZKasino incident is not properly handled, it will require the cooperation of exchanges, security companies and law enforcement agencies to recover the victims' assets.
Currently, Beosin KYT has monitored the relevant addresses and issued warnings for all address activities as soon as possible.
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