Crypto casino founder Richard Kim was arrested on Tuesday. The man behind Zero Edge has been accused of spending investor money on gambling.
In an FBI file, it states that Kim “gambled away his investors’ funds”. This was done by allegedly transferring “investor funds from Zero Edge accounts to his personal accounts”. He then used them in “speculative cryptocurrency trades and gambling”.
The report also states that he had spent the entirety of the investor funds within a week. This includes moving “approximately” $3.8 million from the pool of money accumulated to Coinbase accounts, and another $1 million moved to other crypto exchanges. Another $2.3 million was also transferred, resulting in a total alleged $6.1 million deposited into his personal crypto accounts.
It has been discovered that Kim used Shuffle.com, a crypto gambling website. $1 million from his plump Coinbase account was then used without telling regulators or investors. Another million was then spent on futures trading, which was also lost.
Crypto casino founder blew through cash
The FBI now estimates that Kim, using his Coinbase and Kraken crypto wallets, moved $7 million on Shuffle.com. In the report, the agent involved states that Kim admitted to spending a vast majority of the money invested on his own “personal gambling”.
Richard Kim did eventually admit in 2024 to his investors that the funds had been misappropriated. At the time – June 29 – he had blown through enough cash to only be left with $460,000. The report states that Kim has a gambling addiction. In another email, he admitted that he has a “deep-rooted gambler’s mentality”.
It was around the time of these emails being sent out that investors began to report Kim to the SEC.
Zero Edge never made it to market, and Kim has posted a $250,000 bond according to recent court documents surrounding the case.
