On Monday, November 14, the recently battle-torn crypto market was met with more potentially difficult news to have to decipher and cut through when Crypto.com released details into a misdirected Ethereum transfer valued close to $350 million sent by the company.
As it turns out, the ETH transfers, which were reportedly pointed out by individuals who track large crypto transfers independently through Etherscan, were in fact completed over three weeks ago, on October 21.
Recent Crypto Uncertainty May Have Led To Transfers Being News
Due to recent events surrounding the insolvency issues of FTX and prior troubling events in the crypto sphere, digital assets investors and traders are already on higher alert than usual. The transfers, which came into public light this past weekend, were conducted in October. That brings to question why they were deemed important to report now, almost a month after being completed and subsequently corrected. The answer, although much more complex when drawn out, is the recent collapse of the FTX exchange and sister company, Alameda Research.
To be clear, even prior to the collapse of the FTX exchange, every bit of news, data and analytics has arguably become more heavily scrutinized and investigated than ever before. This has been a very challenging year for crypto with hacks, ecosystem crashes, regulatory uncertainties, bankruptcies and more.
The Accident Explained By Crypto.com CEO To No Avail
The explanation for accidental transfer was explained by Crypto.com CEO Kris Marszalek as one which was actually supposed to go to one of the firm’s cold wallet storage wallets. But instead of going to the intended destination, the approximate $350 million in ETH was sent to a wallet owned by Gate.io. It was one of only a few addresses permitted to interact with the crypto.com digital wallet.
It was supposed to be a move to a new cold storage address, but was sent to a whitelisted external exchange address. We worked with the Gate team and the funds were subsequently returned to our cold storage. New processes and features were implemented to prevent this from reoccurring.
Kris Marszalek, CEO, Crypto.com
Red Flags Still Being Raised Concerning Crypto.com
The Chief of the largest crypto exchange in the world, CZ took to Twitter on November 13, the same day the news of the transfer began to surface. In an official CZ tweet, the Binance CEO shared his opinion that exchanges which move large amounts of crypto in the days preceding or following confirming the value of assets held in custody should be avoided.
Several individuals commented in the thread shared by CZ, agreeing with the sentiment, and Crypto.com as well as Gate.io were named by several responding accounts as being exchanges which are currently in questionable statuses and should be scrutinized more closely than normal. As a result of the questions, the value of the CRO digital asset, native to the Crypto.com digital ecosystem, has been down-trending since the weekend.
Value Of CRO Struggles As Crypto.com Accidental Transfer News Breaks
Cronos is the blockchain and decentralized ecosystem of the Crypto.com platform and the associated cryptocurrency is CRO. From Friday the 11th through Sunday, November 13 when the news was breaking, the value of CRO dropped by around 30%, before recovering some of the price drop by the morning of Monday the 14th. At the time of writing, CRO is trading at $.067, still down about 46% in seven days.
In a time when the largest names in the crypto space are proving to be just as susceptible to falling as others, this news has put both Crypto.com and Gate.io on the radar at a time in which no exchange really desires to be. Crypto.com CEO, Kris Marszalek has continued to offer information and transparency in attempts seemingly directed to keep investors and onlookers at ease. CNL will continue to share relevant updates as the latest blockchain news develops around Crypto.com and other breaking crypto news.
