The boss of cryptocurrency exchange Crypto.com has slammed “naysayers” who questioned its finances as markets rattled after the collapse of rival exchange FTX.
Kris Marszalek, chief executive of Singapore-based crypto.com, insisted its balance sheet was strong and was not taking risks after investors took to Twitter over the weekend to question the transfer of $400 million in ether to another exchange.
He used an “ask me anything” discussion via YouTube to address speculation about the Oct. 21 transfer, which, according to the Wall Street Journal, sparked a series of withdrawals saying the tokens had been withdrawn.
He told an audience of 7,000: “At no point is there any risk of funds being sent somewhere they can’t be retrieved. This has nothing to do with any of FTX’s insanity.”
Mr. Marszalek moved first to reassure them that the exchange’s fundamentals were sound.
He promised to release an audited proof of reserves report within weeks, adding that crypto.com was not involved in any “irresponsible lending products.”
Comment on Spectacular Public Crash or FTX Last week, according to a Reuters report, at least $1 billion in client funds was lost, Mr Marszalek said: “It’s setting the industry back years in terms of the reputation we’ve built.
“Trust has been damaged, if not lost, and we need to focus on rebuilding it.”
Crypto.com had about $10 million in exposure due to the FTX crash, he said.
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Crypto.com is one of the top 10 global exchanges by turnover, but smaller than FTX and market leader Binance.
Bitcoin and ether rose about 1% to $16,650 and $1,226, respectively, in early trading on Monday.
Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, said: “While the storm following the collapse of major exchange FTX has subsided, the damage left in its wake has been considerable and cryptocurrency speculators, hard hit by these recent losses, will lick some sore wounds.
“This is a painful reminder that the crypto wild west remains a fragile niche within the larger financial system, with money being bet on highly speculative assets.
“In an opaque world where fraud is rife, and despite growing calls for greater regulation, the whole debacle is also a source of relief, as regulators’ deep doubts about the stability of cryptocurrencies have made larger, More established financial institutions are immune to contagion.”