CryptoCom CEO Says Balance Sheet Is Strong, Exchanges Not In Trouble
The CEO of Singapore-based CryptoCom said the company will prove all the naysayers wrong about the platform being in trouble, and that it has a strong balance sheet and no risk.
CEO Kris Marszalek took questions in a live YouTube address, and said the platform always maintains a reserve to match all the coins customers have stored on their platform.
“We will continue with our business as usual and we will prove all the naysayers and there are (sic) many of these right now on Twitter these past few days,” Marszalek said.
“We will prove them all wrong with our actions. We will continue to operate as we have always operated. We will continue to be a safe and secure place where everyone can access crypto.”
The audited evidence of the reserve report will be published in a few weeks, he said, and that the exchange did not participate in any “innocent lending products”.
The ‘AMA’ (ask-me-anything) came after investors took to twitter over the weekend questioning the transfer of ether tokens worth 400 million (roughly Rs. 3,250 crore) to another Gate. io on October 21.
Marszalek had tweeted that the ether had been recovered and returned to the exchange, but that failed to calm the jittery market. The Wall Street Journal reported that Crypto.com withdrawals increased over the weekend following Marszalek’s tweet.
“There was no time when the funds were in danger of being sent to a place where we couldn’t get it back. It happened three weeks ago. It had nothing to do with any of the craziness that has been going on since the collapse of FTX,” said the CEO. .answering questions, about 7,000 people watched it live.
The cryptocurrency market is already on edge with the dramatic public fall of FTX last week. FTX went from being one of the biggest exchanges in the world to filing for bankruptcy. A Reuters report found that at least $1 billion (about Rs. 8,120 crore) of customer funds were missing from FTX.
“This has set the industry back a few years from the reputation it built,” Marszalek said. “Trust has been damaged, if not lost, and we need to focus on rebuilding trust.”
The movement of ether at CryptoCom was discovered by a user who intercepted the transaction after the company posted its cold wallet addresses online.
CryptoCom is among the top 10 exchanges by revenue worldwide, but is smaller than FTX and market leader Binance. It made headlines in 2021 after it signed a $700 million (roughly Rs. 5,690) deal to rebrand the Staples Center in Los Angeles as the CryptoCom Arena, and roped in actor Matt Damon to promote the arena.
Marszalek said that CryptoCom has 70 million individual customers around the world, and has made billions of dollars in revenue in 2021 and 2022.
The platform had moved about $1 billion (approx. Rs. 8,120 crore) to FTX in a year but most of it was realized and the exposure at the time of FTX collapse was less than $10 million (approx. Rs. 80 crore) , he said.
Asked why the exchange had 20 percent of its reserves in the Shiba Inu (SHIB) meme token, Marszalek said that was because the reserves are a direct individual representation of the client’s assets and that SHIB and Dogecoin were the most popular in 2021. . .
© Thomson Reuters 2022