Dutch authorities apprehended a 26-year-old man allegedly involved in a rug pull scheme associated with the Web3 gambling platform ZKasino.
The arrest transpired on Monday as part of an ongoing probe into charges of fraud, embezzlement, and money laundering, led by the Fiscal Information and Investigation Service of the Netherlands (FIOD).
In a coordinated effort, law enforcement conducted a search of the suspect’s residence, confiscating both physical and digital evidence, along with assets totaling around 11.4 million euros ($12.2 million). These assets included real estate holdings and various cryptocurrencies.
The FIOD hinted at the potential for additional arrests as the investigation advances. Though initial disclosures didn’t specify the suspect’s role within ZKasino, subsequent clarifications revealed him to be a member of the platform’s team.
Initially marketed as a decentralized gambling network, ZKasino drew scrutiny when it modified its token redemption policies upon launch, effectively preventing investors from reclaiming their bridged ether tokens—a stark departure from its initial assurances. This sudden policy shift impacted over 10,000 investors who had collectively bridged more than $33 million into the platform, sparking widespread allegations of a rug pull scam.
The FIOD’s statement elucidated that investors were initially promised retrieval of their investments within 30 days. However, the smart contract setup on the blockchain suggested that returning the funds was never the intention, a telltale sign of a rug pull scheme.
Following his apprehension, the suspect faced a magistrate on Thursday, where his detention was prolonged by an additional two weeks pending ongoing investigations.
As a member of the European Union, the Netherlands is part of a trading bloc that recently enacted the Markets in Crypto Asset (MiCA) legislation. This EU-wide regulation enables companies to secure a single license in one EU country and operate across the entire union.
The arrest transpired on Monday as part of an ongoing probe into charges of fraud, embezzlement, and money laundering, led by the Fiscal Information and Investigation Service of the Netherlands (FIOD).
In a coordinated effort, law enforcement conducted a search of the suspect’s residence, confiscating both physical and digital evidence, along with assets totaling around 11.4 million euros ($12.2 million). These assets included real estate holdings and various cryptocurrencies.
The FIOD hinted at the potential for additional arrests as the investigation advances. Though initial disclosures didn’t specify the suspect’s role within ZKasino, subsequent clarifications revealed him to be a member of the platform’s team.
Initially marketed as a decentralized gambling network, ZKasino drew scrutiny when it modified its token redemption policies upon launch, effectively preventing investors from reclaiming their bridged ether tokens—a stark departure from its initial assurances. This sudden policy shift impacted over 10,000 investors who had collectively bridged more than $33 million into the platform, sparking widespread allegations of a rug pull scam.
The FIOD’s statement elucidated that investors were initially promised retrieval of their investments within 30 days. However, the smart contract setup on the blockchain suggested that returning the funds was never the intention, a telltale sign of a rug pull scheme.
Following his apprehension, the suspect faced a magistrate on Thursday, where his detention was prolonged by an additional two weeks pending ongoing investigations.
As a member of the European Union, the Netherlands is part of a trading bloc that recently enacted the Markets in Crypto Asset (MiCA) legislation. This EU-wide regulation enables companies to secure a single license in one EU country and operate across the entire union.
![[DK]](/data/avatars/s/57/57999.jpg?1720990206){kind=avatar}
