Crypto.com Faces Backlash Over 70-Billion-Token Reissuance

Crypto.com, a prominent cryptocurrency exchange, is under intense scrutiny following the reissuance of 70 billion CRO tokens. These tokens were previously claimed to have been permanently burned in 2021, a move that was intended to increase the asset's value and boost investor confidence. The reissuance has sparked allegations of financial manipulation and has raised significant concerns about the platform's transparency and ethical practices.

Blockchain investigator ZachXBT has been vocal in criticizing Crypto.com's actions. ZachXBT accused the platform of misleading users and controlling the majority of CRO’s supply, which has undermined community trust. The investigator suggested that Truth Media, the social media platform owned by Trump Media & Technology Group (TMTG), would be better positioned to partner with other exchanges such as Coinbase or Gemini, rather than Crypto.com.

The reissuance of the CRO tokens has sparked immediate outrage among the crypto community. Many users believed that the 70 billion CRO tokens were gone permanently, and the promise of burning these tokens was positioned as a deflationary measure. The revelation that these tokens have been reinstated has caused investors to lose faith in the exchange’s credibility, with many viewing the move as a blatant manipulation of tokenomics.

Adding to the controversy is Crypto.com's partnership with TMTG, which has raised questions about ethics and credibility. Allegations suggest that Crypto.com CEO Kris Marszalek may have used substantial influence to secure the deal with Truth Social. The partnership has also been met with skepticism, as TMTG’s stock soared 9% after announcing the prospective Cronos ETF partnership, despite the company reporting a staggering loss in 2024. This has led some to question the ethics of the partnership and the motivations behind it.

While Crypto.com has yet to issue a detailed response to the allegations, the damage to its reputation may be long-lasting. The partnership with TMTG was expected to boost legitimacy, but now the firm seems overshadowed by allegations of deception and financial manipulation. This recent upheaval at Crypto.com highlights the fragile trust in the cryptocurrency ecosystem. With ongoing scrutiny over its practices and the implications of token re-issuance, the exchange must work diligently to restore confidence among its users. Transparency regarding operations and partnerships is essential for Crypto.com to avoid potential long-term reputational damage.