Binance has helped law enforcement authorities apprehend the perpetrator in the ZKasino scam.
Following widespread community outcry, Binance’s Criminal Compliance and Investigations team was tasked with investigating the fraudulent gambling platform.
Binance’s research team said in a statement that researchers used a combination of on-chain tracking and open source intelligence information (OSINT) approaches to track down the attackers.
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ZKasino scam
“We investigated all of ZKasino’s smart contracts in a kind of behavioral network study to find out not only who is behind the contracts but also who the signers of these addresses are.”
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After identifying the suspects behind the smart contract, Binance notified law enforcement about the fraudulent account holders. The Fiscal Intelligence and Investigation Department (FIOD) arrested a 26-year-old suspect on April 29 and seized digital assets, real estate, and luxury cars worth $12.2 million, according to a May 3 FIOD report.
ZKasino scam arrest.
This is the first arrest in the ZKasino fraud case, in which investors lost at least $33 million in digital assets. According to the April 29th FIOD report, “ZKcasino advertised itself as a gambling platform and a blockchain casino.
Investors were led to believe that they would get their investments back within 30 days.” However, Dutch authorities believe that the smart contract suggests that the website never intended to return the funds. After law enforcement obtained warrants for the attackers’ accounts,
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Binance was able to freeze millions of dollars in cryptocurrency stolen through ZCasino’s Tapestry. Binance’s investigation team also assisted Dutch authorities with on-chain forensics to identify the flow of funds and understand how the fraudulent ZKasino smart contracts were set up.
arrest and identification of the ZKasino scam.
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According to Etherscan, over $32 million in user assets were transferred to another address before being committed to Lido Finance’s Liquid Staking protocol.
In connection with this incident, the cryptocurrency exchange MEXC canceled the listing of the native token of the ZKAS project, and the Ape Terminal platform canceled the initial coin offering.
Venture capital firm Big Brain Holdings has also distanced itself from ZKasino, claiming it has never invested directly in the cryptocurrency casino. Binance’s investigation team said the community played a key role in the arrest and identification of ZKasino.
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Cryptocurrency investors, including prominent crypto analyst Fatman, suspect that the pseudonymous ZKasino builder, Derivatives Ape, is the mastermind behind the scam
Despite the arrests, the funds continued to move in a chain, suggesting that multiple assailants were involved in the carpet heist.
Binance’s investigation team will work closely with relevant authorities to ensure that stolen funds are returned to investors. This is currently under investigation and, according to FIOD, “further arrests are not excluded.”
In early May, Binance also helped Indian authorities thwart a fraudulent investment scheme masquerading as a gaming platform, resulting in the recovery of millions of dollars worth of assets.
Police are receiving assistance from Binance cryptocurrency exchange in the arrest of the culprit in the ZKasino scam.
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