A cryptocurrency scammer behind the fraudulent blockchain-based gambling project ZkCasino has recorded massive losses of over $27 million through liquidation.
The individual, who had previously swindled millions from unsuspecting investors, opened a highly leveraged 20x long position on Ethereum (ETH) via Hyperliquid, a decentralized perpetual futures exchange.
However, the market turned against the position, leading to a full liquidation with losses totaling $27.1 million, according to the latest on-chain data retrieved by Finbold from Onchain Lens on April 7.
ZkCasino scam
Before this downfall, the scammer reportedly stole over $40 million through the ZkCasino scheme, a fake gambling platform and blockchain casino that lured investors with false promises of quick returns.
ZkCasino marketed itself as a legitimate operation, claiming investors could recover their funds within 30 days.
It’s worth noting that the platform launched in April 2024, attracting users with the promise of a token airdrop for bridging ETH.
Instead of returning the funds, it redirected $33 million in ETH to Lido Finance. Nearly a year later, the wallet has re-emerged, only to see the funds liquidated.
The brutal liquidation is tied to the sharp drop in Ethereum’s price, which aligns with the broader cryptocurrency market.
ETH was trading at $1,554 at press time, down over 11% in the past 24 hours and 14% on the weekly chart.
Following exit scam allegations, ZkCasino claimed it would return user funds within 72 hours, but only if investors surrendered their ZKAS tokens and any future entitlements.
On April 29, 2024, Dutch authorities arrested a suspect, and shortly after, all bridged ETH was returned to ZkCasino’s multisig wallet. Despite this, the ETH remains unreleased nearly a year later.
Featured image via Shutterstock
