- Crypto.com CEO said during an AMA that the exchange is not at any risk of insolvency.
- The clarification is coming after it emerged that the platform is struggling financially following irregular on-chain activities.
Kris Marszalek, the CEO of crypto exchange Crypto.com, has dismissed rumors that the platform could be the next crypto giant to collapse after FTX.
Marszalek stated during a live AMA session that Crypto.com is not at any risk of insolvency but is instead carrying on its business as usual with seamless deposits, withdrawals, and trading happening although at a heightened level.
“Most importantly, consider our platform is performing like its business as usual. People are depositing, withdrawing, people are trading. There is pretty much normal activity, just that at a heightened level,” he said.
He further noted that Crypto.com is one of the most regulated crypto companies in the industry. The company has the most licenses and registrations from “tier 1” jurisdictions including the U.S., Europe, Singapore, and the U.K., he said.
Withdrawals are being processed as usual. No FUD please.
— Kris | Crypto.com (@kris) November 14, 2022
He also emphasized that the Singapore-based exchange’s business model is different from that of FTX. Crypto.com operates a business model based on access to cryptocurrencies, reinvesting its profits from trading fees to build “compliant, secure infrastructure.” He pointed out that, unlike FTX, Crypto.com is never going to raise funds, engage in irresponsible lending practices, trade customer assets, or use its CRO token as collateral.
“These are businesses in the same industry, but we operate completely differently. We’ve got more than 70 million people on our platform globally who have downloaded our app. Our business model is very simple, we provide access to the masses to digital assets, and we take a fee for it,” he added.
Other clarifications made by Crypto.com CEO
Marszalek’s clarifications are coming after reports of irregularities at the exchange emerged in the crypto community. One of these was the recent discovery that Crypto.com sent around $400 million worth of ETH to another exchange Gate.io.
Both Marszalek and Gate.io have clarified that the transaction was an error and has been corrected. Crypto.com has also published a proof-of-reserve and announced plans to conduct a full audit in the coming week. However, this did not prevent users from panic withdrawing their assets according to a Bloomberg report.
One of the first 100 employees at https://t.co/zTtsWR0joP: It is almost impossible for $400m to be 'accidentally' transferred without manual approval and various checks
I was fired from https://t.co/zTtsWR0joP as I had ethical concerns about how the company was run.
— Mario Nawfal (@MarioNawfal) November 13, 2022
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Meanwhile, he also mentioned during the AMA that Crypto.com’s signing of a stadium sponsorship deal has not made a dent in the company’s revenue. He noted that only a small amount of the deal’s amount is paid every year and that the investment is worthwhile for marketing.