Dutch authorities have arrested a 26-year-old man in connection with a large-scale scam involving ZKasino, a controversial crypto gambling platform that disappeared with approximately $30 million in user deposits last month. The platform faced backlash after it converted users’ Ether deposits into a new token, sparking outrage among investors.
According to legal documents, the primary figure behind ZKasino, known online as Derivatives Monke, is identified as Elham Nourzai. The arrest took place during an investigation led by the FIOD, a Dutch agency focused on financial fraud, which revealed Nourzai’s alleged involvement in fraud, embezzlement, and money laundering.
The FIOD stated that Nourzai’s arrest is part of an investigation into the ZKasino scam, where more than $30 million in cryptocurrency was reportedly invested by victims. In addition to the arrest, authorities seized €11.4 million worth of assets, including real estate, luxury cars, and cryptocurrencies.
The fallout from ZKasino has led to a victim’s chat group forming, where investors express their anger and hope for justice. Many believe the arrest signals a step closer to recovering their lost funds. A user named bingojack stated, “It shows the system works and that these muppets cannot get away with it.”
ZKasino had previously launched a program called Bridge-to-Earn, offering users rewards for locking up their Ether. However, the project later changed its rules, converting users’ Ether into ZKAS tokens without their consent, effectively keeping their funds. On-chain records reveal that ZKasino has been converting users’ Ether to Lido’s Wrapped Staked Ether, allowing ZKasino to earn staking rewards instead of users.
Investors like Defizard, who invested $24,000 in ZKasino, voiced concerns over the project, stating that they were attracted by favorable investment conditions. Others, like BlackDragon’s CEO, described red flags during their due diligence process that prevented them from investing.
The ZKasino founders, including Nourzai, had prior involvement with a project called ZigZag Exchange, where they allegedly misappropriated funds from the ZigZag treasury to develop ZKasino. This alleged theft has further complicated their legal situation.
As dozens of ZKasino depositors seek to recover their investments, the arrest could be a pivotal moment in their quest for restitution. However, past attempts by investors to reclaim lost funds from similar crypto scams have often met with limited success.
Investor Dylan Grover, who deposited around $7,500 into ZKasino, reflected, “I should’ve dug a little deeper, but I’ve done many coin launches and have done pretty well with them.” Thousands of individual investors are now left hoping for a resolution to the crisis.
