Exchange Crypto.com’s cold store information recently revealed a dubious transfer of 320,000 Ethereum to a wallet address linked to Gate.io on October 21, 2022. However, Kris Marszalek—the CEO of Crypto.com—clarified that the funds were supposed to be moved to a new cold storage address, but was accidentally sent to a whitelisted external exchange address.
Nevertheless, Crypto.com eventually went on to withdraw all the funds and send it back to its cold storage.
Owing to the said muddle, fear—yet again—started spreading like wildfire among investors. On-chain data revealed that nearly 90k unique transactions had been processed in just a matter of hours. The spike, single-handedly, indicated that users have been rushing to get their funds out of the exchange.
In fact, on social media platforms like Twitter, a lot of speculations have been going on about how Crypto.com could be the next FTX.
While one particular user went on to claim that the exchange “will likely fall,” another opined that it was “guaranteed to go bankrupt, just like FTX.”
Also Read: Will Ripple end up sharing the same fate as FTX, BlockFi?
Alongside, a prominent Chainlink stalwart went on to ask users to withdraw funds from the exchange. The user, however, stated that there was no concrete proof of the exchange going down. Citing the latest mis-transfer as a reason for wavering confidence, the user said,
“To be clear, I don’t claim to have any evidence of malicious intent or insolvency. But given their historical operational failures—misplacing $400M of customer’s ETH—I don’t exactly have high confidence.“
Crypto.com CEO clears the air
In a recent interview on Monday, Marszalek affirmed that the exchange wasn’t going anywhere. The executive noted that his company did have exposure to the dramatic collapse of FTX. However, the same was limited to $10 million.
Marszalek also went on to confirm that Crypto.com entailed a strong balance sheet. He added that the business was cash flow positive, self-sufficient, and would never raise funds.
Read More: Crypto.com balance sheet is strong with minimal FTX exposure: CEO
Now, if that’s indeed the case, the tides may reverse back into the exchange’s favor. Alongside, it should also be noted that the FIFA World Cup is set to start next week and via its association with the mega football tournament, Crypto.com would get a chance to clean the slate and re-work its goodwill.
Thanks to the clarity provided by Marszalek, the native token of the exchange was back to trading in green. At press time, CRO was priced at $0.06918, after noting a 5% uptick on the daily.