Investing.com– Chrono (NASDAQ :), Crypto.com’s native token dropped to its lowest level in 22 months on Monday, amid increasing scrutiny by centralized exchanges following the collapse of major player FTX earlier this month.
It fell 28% to $ 0.0557, halving over the past week as investors feared a potential liquidity crisis similar to that seen on FTX.
Concerns over the exchange’s financial situation increased over the weekend after on-chain data showed it accidentally sent around 82% of its Ethereum reserves, or around $ 400 million, to a wallet in October. connected to Gate.io.
Although the funds were recovered, traders said the transfer contradicted Crypto.com’s claims that all user funds are kept offline in a cold wallet.
The exchange, which also recently disclosed its cryptocurrency reserves, has drawn criticism for having more than 20% of its reserves in the cryptocurrency.
These revelations came shortly after FTX collapsed, accused of misappropriating client funds and being unable to meet withdrawals. Sentiment towards centralized traders such as Crypto.com was severely shaken by the meltdown, with several industry players urging traders to transfer their funds from centralized exchanges.
Binance CEO Changpeng Zhao also lashed out at Crypto.com, warning users to “switch away”.
While Crypto.com CEO Kris Marszalek assured traders that their funds were safe, a growing number of social media influencers advised users to withdraw their funds from the platform.
CRO losses have far outstripped declines in the broader cryptocurrency market in the past 24 hours. , the largest cryptocurrency in the world, the US dollar plummeted 4% and hovered around the lowest level in the last two years, while losing 6%.
Tokens from other centralized exchanges also decreased. it lost almost 5%, while it lost 6%.
Cryptocurrency markets were in free fall last week after FTX, the third largest exchange in space, filed for bankruptcy and suspended customer withdrawals. Attention is now turning to other entities exposed to the exchange, with lender BlockFi having recently suspended withdrawals due to its exposure to the ailing exchange.
By Ambar Warrick