- Crypto.com, the cryptocurrency exchange and crypto debit card provider, has come under attack from a Reddit user
- The user, ethhoder, criticized the company for its slow withdrawals, “Ponzi-like promotions”, and the approach by company executives
- Other users have complained about the absence of customer service
A Reddit user has posted a warning about Crypto.com, the crypto exchange and crypto debit card provider, criticising the company for a number of failings and urging others to use caution when using the platform. The user, ethhodler, lists four areas of concern, from withdrawal delays to the senior executives’ previously failed ventures, while concerns over lack of a customer service operation and the Wirecard fiasco add to the complaints.
Withdrawal Issues and “Ponzi-like” Promotions
Ethhodler’s first complaint revolves around reports that customers are waiting up to 72 hours to receive funds from withdrawals, saying that this is “never a good sign”. Indeed, withdrawal issues is one of the classic first signs of a crypto scam. Ethholder says that the delays have been blamed on “unspecified technical issues”, which he says are unacceptable in 2020.
The second issue ethholder has with the platform is the promotions, which “have a ponzi-like feel to them.” He says that a recent promotion offered customers the chance to buy Bitcoin at 50% off compared to Crypto.com’s CRO token, a system that on the face of it would see Crypto.com losing out, unless they have a ready supply of Bitcoin to dip into…like user funds.
Crypto.com Take a “Different View Toward Compliance”
Ethholder also criticizes the staking and lending features of the platform, saying that the rates are permanent and the same for lending and borrowing, whereas other operators such as Celcius have floating interest rates to match the volatility of crypto and use of the product. Crypto.com operates in areas where Celcius doesn’t, ethholder says, asking if “Crypto.com is better at obtaining regulatory compliance, or they take a different view toward compliance.”
The final criticism comes as ethholder questions the validity of the Crypto.com business model, with the senior executives alleged to be copying the same “marketing playbook” as they did with their previous project, a now defunct online retailer Ensogo:
At some point, this marketing expense will need to be accounted for. The question is: who pays? Will it be covered with their own funds? Or will it be covered with customer deposits?
Etholder Not Alone
Ethholder isn’t the only user to have questioned certain aspects of the Crypto.com offering, with others saying that the customer service isn’t exactly…obvious:
Not usually the one to make a public complaint about a service but https://t.co/LFQq5h4fdz customer service is non-existent. As in, it doesn’t exist. At all. While they spend a fortune on advertising they can’t get basic customer requirements right. Not the strongest look.
— SuperMassive.eth (@DirSchmidt) June 23, 2020
Ethholder adds that he has raised his objections in the Crypto.com subreddit but says he was banned after making a post regarding the issues. Very few people have come to the defense of the company in the replies to ethholder’s post, with many agreeing with some of his points and reporting their own issues.
What makes matters worse for Crypto.com is the situation with Wirecard, the company behind their debit card provider, who have seen the company all but collapse following the revelation of a decade-long accounting scandal. Crypto.com will have to move quickly to stop suggestions of impropriety getting more traction, but it doesn’t look like they’re too bothered at the moment.
