ZKasino scammer loses $27M after Ethereum liquidation

A wallet linked to the $40 million ZKasino scam suffered a significant loss of $27.1 million after a leveraged Ethereum (CRYPTO:ETH) position was liquidated.

The liquidation occurred as Ether's price dropped sharply to $1,480, marking its lowest level in nearly two years, following major sell-offs in traditional equity markets.

ZKasino, a blockchain-based gambling platform launched in April 2024, initially gained attention by promising an airdrop of its native token to users who bridged Ether to the platform.

However, instead of delivering on its promises, the platform transferred around $33 million of user ETH to Lido Finance, which led to accusations of an exit scam.

Despite assurances from ZKasino that funds would be returned through a "2-step bridge back process," investors have remained empty-handed nearly a year later.

Blockchain analytics firm Onchain Lens reported the liquidation on April 7, noting that the wallet behind the alleged exploit had closed its 20x leveraged position on Hyperliquid.

Onchain Lens referred to the financial loss as "karma" for the scammer, highlighting the significant hit to the wallet’s operator.

This liquidation adds another chapter to the controversial history of ZKasino.

Dutch authorities arrested a suspect linked to the scam in April 2024, seizing $12.2 million in assets, including cryptocurrency, real estate, and luxury cars.

However, despite legal actions and partial asset recoveries, investors have yet to see their funds returned.

Investor frustration has been further fueled by ZKasino’s shifting policies and lack of transparency.

The platform repeatedly altered its website language and refund processes, raising concerns about its intentions.

While some bridged ETH was returned to ZKasino’s multisignature wallet last year, hopes for full refunds remain uncertain.

At the time of reporting, the Ethereum (ETH) price was $1,562.27.