The crypto exchange Crypto.com mistakenly sent 320,000 ETH to a wallet address linked to Gate.io end of October 2022. Although the platform has since recovered the assets, Binance CEO Changpeng Zhao advised users to stay away from the platform.
The unprecedented collapse of FTX, which was once the third largest cryptocurrency exchange and gained a reputation as the king of crypto bailouts in the recent crypto winter, led. many players in the sector to express their concern about the reliability of centralized players.
In an attempt to answer this doubt, Crypto platform executives have begun sharing evidence of reservations. Therefore, Crypto.com publishes its addresses, revealing how many and which cryptocurrencies it stores for its customers.
However, users are quick to recognize a suspicious transfer of 320,000 ETH to a wallet linked to Gate.io on October 21, 2022largely because the exchange claims that all user-owned cryptocurrencies are stored offline in cold storage along with Ledger.
Crypto.com CEO Kris Marszalek revealed that the transaction was a mistake. “It was supposed to be sent to a new cold storage address, but it was sent to an external exchange address that was whitelisted,” he said, adding:
“We worked with the Gate team and the funds were immediately returned to our cold storage. New processes and features have been put in place to prevent this from happening again.”
Despite the clarification, the crypto community remains with a bitter taste in the platform. Many users have asked how it was possible to accidentally send a whopping $400 million worth of ETH to a wrong recipient address.
This is not the first time that Crypto.com has made such a mistake. In August, the exchange made headlines after it revealed it had accidentally sent A$10.5 million (worth more than US$7 million) to Melbourne-based investors instead of a refund of 100 Australian dollars (67 US dollars). What is worse is that the incident happened in May 2021, and was not noticed until December 2021.
On his part, the CEO of Binance, CZ, who was recently in the news for his involvement in the FTX saga, users are advised to stay away from Crypto.comsaying that what just happened is a clear indication of their lack of competence.
“If an exchange has to transfer large amounts of crypto before or after they show their wallet addresses, that’s a clear sign that there are problems. Stay away from them. Stay with SAFU,” a- he declared.
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