Michaela
Blockchain investigator ZachXBT has called Crypto.com’s CRO token a scam after the platform reversed a 70 billion token burn. The decision has sparked concerns over governance transparency on the Cronos blockchain.
The blockchain investigator criticized CRO in response to a recent announcement from the exchange’s CEO, Kris Marszalek. Marszalek shared news of a partnership between Crypto.com and Trump Media, the parent company of Truth Social, the media platform founded by President Donald Trump. In reaction to the post, ZachXBT alleged that CRO is “no different from a scam.”
“Your team just reissued 70B CRO a week ago that was previously burned “forever” in 2021 (70% total supply) and went against the community wishes as you control majority of the supply,” ZachXBT wrote. The investigator also questioned why Truth Social chose to partner with Crypto.com instead of other established exchanges like Coinbase, Kraken, or Gemini, given the recent developments.
Crypto.com faced backlash last week after a disputed vote led to the reversal of a major token burn on its Cronos blockchain. In response to the controversy surrounding the reissuance of 70 billion Cronos tokens, CEO Kris Marszalek addressed the matter on X on March 19, affirming the company’s financial and regulatory stability.
In February 2021, Crypto.com made headlines by conducting one of the largest token burns in the cryptocurrency industry, eliminating 70 billion CRO tokens from circulation. The burn, which was part of the company’s strategy to decentralize its network, reduced the total supply of CRO tokens from 100 billion to just 30 billion.
The burn was seen as a key step in the launch of the CRO mainnet, a major milestone for Crypto.com. The company immediately burned 59.6 billion CRO tokens, with the remaining 10.4 billion allocated to monthly burns, block rewards, and ecosystem development efforts. This move was also intended to improve the token’s value and make the network more community-driven by reducing the total circulating supply.
Crypto.com’s Token Burn
Crypto.com’s decision to perform such a large-scale token burn was met with positive reactions at the time, as it signaled the company’s commitment to creating a more decentralized and secure platform.
A “token burn” involves permanently removing tokens from circulation to reduce supply and potentially increase the value of the remaining tokens. However, in some cases, burned tokens can be reissued. This can happen through governance decisions, where the community or governing body votes to reverse the burn, or by creating a strategic reserve where burned tokens are stored and later reintroduced into circulation if needed.
While reissuing burned tokens is technically possible, it often faces community backlash as it can impact tokenomics and investor confidence.
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Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
