ZigZag drama unfolds on heels of fraud allegations

  crypto.news 13 h

The zkSync decentralized exchange project, ZigZag, has accused the decentralized gambling platform ZKasino of fraud, claiming that the money used to build ZKasino was stolen from the ZigZag Treasury.

ZigZag founder Kedar Iyer called out ZKasino founders on X, saying: “They would claim they were taking money out to pay developers for building the ZigZag frontend, then use parts of the money to build out ZKasino.”

I’m gonna lay this out since it gets worse and worse everyday.

Multiple people have approached me in the past week with allegations that the @ZKasino_io team owes them money or defrauded them in some way.

Multiple former employees and contractors have contacted me to let me…

— ZigZag Exchange (@ZigZagExchange) March 23, 2024

ZKasino founders, specifically Derivatives Monke, were responsible for the ZigZag fundraising, where $15 million was raised and went into addresses controlled by ZKasino founders.

“I never had control of that money, so it is possible more of that money was stolen or went into ZKasino than I was aware of,” said Iyer.

Iyer alleges that “market making” TerraUSD (UST) against his recommendation and leverage trading on FTX contributed to lost funds.

This is fun time to mention the 2nd part of the fraud.

When @Derivatives_Ape and his friends took the raised money for ZigZag, they lost half of it market making UST (against my recommendation) and lost the other half leverage trading on FTX trying to make the money back.… https://t.co/n1r5Lqo2db

— ZigZag Exchange (@ZigZagExchange) March 23, 2024

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Kedar further stated that he previously demanded recompensation for about $1 million, which went into funding ZKasino to no avail. Therefore, ZigZag token holders should attempt to get restitution on their own.

Moreover, he said that multiple former ZKasino employees and contractors had contacted him with claims that they hadn’t been paid for their work.

Iyer blamed the failure of ZigZag on Derivatives Monke’s “incompetence,” stating that he has been unable to develop ZigZag further because he ruined the fundraising and destroyed the project.

2/5
However, let’s address a question: Who should be held responsible for the failure of Zigzag?

In my opinion, Kedar (the current controlling figure of Zigzag on Twitter) is the main reason for Zigzag’s failure. He not only lies in public but is also a gambler, as his tweets…

— Feichi ∎ (@Coincony1) March 23, 2024

One ZigZag employee, by the username Feichi, defended Derivatives Monke, and clapped back at Iyer, saying he has “a lazy attitude towards work.”

Derivatives Monke also responded to the tweet, saying that Iyer was trying to blame them for ZigZag’s failure after seeing the success of ZKasino and Syncus, another platform he founded.

You are an envious loser.

Imagine trying to blame the failure of ZigZag on us after seeing our success with Syncus and ZKasino.

Last week you asked us for a team allocation in ZKasino (even though you did no work) then you blow up on Twitter when we refuse to give it to you.… https://t.co/M75WHAM8e6

— Derivatives Monke (@Derivatives_Ape) March 23, 2024

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