Ethereum Co-Founder Vitalik Buterin Slams Misuse of Zero-Knowledge Proofs in ZKasino Scandal
Vitalik Buterin, one of the founding members of Ethereum He spoke on key concerns related to ZKasino fraud, as well as the misuse of the term “Zero-knowledge” (ZK) in the context of a significant scam. This controversy saw approximately $33 million in Ethereum (ETH) being swindled by the platform’s deceptive practices.
Vitalik Buterin The criticism points out the difficulties that the cryptocurrency industry encounters due to the reliance on jargon like “Zero-Knowledge”. It also emphasizes the need for more focus and transparency in projects associated with blockchain technology. As the crypto community and regulatory bodies are working towards tighter regulation, it is expected that these issues will become less common.
ZKasino Allegedly Misused Ethereum on Lido Platform
ZKasino Asserted to provide gambling services using blockchain technology, the platform did not fulfill its commitments. On April 21st, the community raised concerns when they observed the removal of a pledge to refund over 10,500 Ethereum that had been transferred and utilized for token farming activities. Closer scrutiny indicated that ZKasino had redirected these funds to Lido, a protocol allowing for liquid staking on the Ethereum network.
The ZKasino team has argued that they converted the bridged ETH into ZKAS tokens while applying a discount of $0.055 and established a vesting duration of 15 months. Nonetheless, this statement faced significant backlash from the cryptocurrency community.
Vitalik Buterin Calls Out the Improper Application of Trendy Cryptocurrency Terms
A well-known cryptocurrency investigator, ZachXBT, revealed the checkered history of ZKasino’s creator, Ildar Elham. Elham faced accusations of failing to pay off debts and avoiding settling wagers.
Additionally, he is believed to have neglected to compensate for an internal phishing incident. Cygaar, a different crypto developer, noted that the ZKasino blockchain doesn’t actually implement zero-knowledge proofs in its technology. He argued that it was merely a facade.
Arbitrum A nitro chain that was constructed in just two minutes. Following these disclosures, numerous investors and cryptocurrency platforms distanced themselves from ZKasino. MEXC , a leading digital currency exchange, has removed the ZKAS coin from its listings. Previously, this exchange had supported the platform by investing in its initial round of funding.
The venture capital company Big Brain has openly declared the ZKasino application to be an outright scam. They emphasized their stance by noting their absence of investment in it and their intention to decline any related tokens going forward. This statement is reflective of a larger trend within the industry to reduce the perils associated with comparable projects on the blockchain.
Vitalik Buterin’s criticism points out the difficulties that the cryptocurrency industry encounters due to the reliance on jargon like “Zero-Knowledge”. It also emphasizes the need for more focus and transparency in projects associated with blockchain technology. As the crypto community and regulatory bodies are working towards tighter regulation, it is expected that these issues will become less common.
