Zinger Key Points
- Crypto.com runs a simple business, as it allows more than 70 billion users global access to digital currencies, CEO says.
- Crypto.com does not need to raise money, as it is well-capitalized and transparent with its reserves, he says.
Crypto.com moved a large amount of Ethereum ETH/USD to a preapproved address, a corporate account, then realized its error and moved the cryptocurrency back to cold storage, CEO Kris Marszalek said in a CNBC interview.
The company has improved its systems so these types of errors do not continue to happen, and it is in no way connected with the fallout of FTX, the CEO said.
What Happened: Marszalek joined CNBC’s "Squawk Box" Tuesday to discuss the fallout from the collapse off crypto exchange FTX as well as the state of digital assets.
While FTX was using its own crypto tokens to make trades and loan itself money, Marszalek said that Crytpo.com has never utilized CRON, its own crypto token, in the way FTX has used its FTX Token FTT/USD.
Crypto.com runs a very simple business, as it allows more than 70 billion users global access to digital currencies and generates earnings through fees, said Marszalek.
"It's a completely different nature of the business versus FTX running a hedge fund in a offshore unregulated derivatives exchange, losing $10 billion in the process.”
Also Read: 'I'm improvising,' Says Sam Bankman-Fried When Asked Why He's Posting Cryptic Tweets
Why It Matters: Marszalek said Crypto.com has a strict process of selecting coins for listing on its exchange and takes great pride in compliance and security, which is at the core of its business model.
In the wake of the FTX collapse, the CEO said liquidity in the market is weak and added that a number of the smaller coins will have to be delisted to protect the consumers.
Crypto.com does not need to raise money, as it is well-capitalized, transparent with its reserves, have a strong balance sheet, zero debt zero leverage and positive cash flow is positive, Marszalek said.
Crypto.com generated over $1 billion in revenue last year, and has already generated more than $1 billion in revenue this year, the CEO said.
Marszalek said he is worried about the impact of the collapse of FTX on the whole industry and the debacle setting back the industry's reputation back a couple years.
Players will have to collectively work for transparency and engage regulators around the world to assure consumers are protected, which is exactly what Crypto.com has been doing over the last week, he said.
Photo via Shutterstock.
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