As refund dispute deepens, ZKasino faces growing accusations of scam over unreturned ether

ZKasino, a Web3 gambling protocol, has come under fire from users who claim they have not received the Ether (ETH) they were promised in refunds.

More than two months have passed since ZKasino launched a "signup" app intended to facilitate refunds, but users allege that the app took their ZKAS tokens without returning any ETH.

Accusations of an Exit Scam

The project was previously accused of being an exit scam, a term used when developers disappear with investors’ funds. On May 28, ZKasino promised to return the ETH that had been bridged to their network via a new app.

However, users report that despite submitting their ZKAS tokens through the app, they have received nothing in return.

One user, speaking anonymously, shared that he had deposited what amounted to a year’s salary, expecting to use the funds for retirement.

He now believes that ZKasino never intended to return the ETH and is simply hoping that those affected will eventually forget about it.

The Illusive Refund Process

ZKasino has stated that it is a Web3 gambling project still in development, operating within the ZkSync ecosystem. The signup app, dubbed “BridgeBackReceiver,” was intended to collect ZKAS tokens in exchange for ETH refunds.

However, on July 29, a transaction moved 26.6 million ZKAS tokens from the signup app to an address controlled by a team member, raising further concerns among users.

ZKasino had previously assured that once all data was gathered, a claim portal would be opened for users to retrieve their ETH.

Despite these assurances, the ETH remains in the team's multisig wallet, and users have yet to see any of their funds returned.

Apology and Future Uncertainty

On August 14, ZKasino issued a statement acknowledging the challenges in refunding all investors due to significant financial losses and the current state of the platform.

"We also have to admit that due to the huge loss of funds and the current financial situation of the platform, recovering the losses of all investors may face great challenges."

The team admitted that the refund process was complex, and many users failed to complete it within the required timeframe, leading to frustration and unmet expectations.

Dubious Schemes and Legal Troubles

The situation took a darker turn when blockchain investigator DKCrypto alleged that ZKasino had misled users with a "bridge to earn" scheme, promising rewards for bridging ETH to the network.

According to DKCrypto, this scheme was meant to end with the launch of ZKasino’s mainnet, but users were left empty-handed.

Law enforcement actions have also been initiated against the project.

"This 'deposit to earn' scheme should end with the launch of the Zkasino mainnet 30 days after the bridge opens, when depositors are promised to receive their $ZKAS tokens, along with all their 'bridge'/'deposits 'The Ethereum is back in their wallets."

Dutch authorities arrested an individual in connection with ZKasino, suspecting fraud and money laundering. The police referred to the project as a "rug pull," another term for a scam where developers disappear after taking investors' funds.