Crypto Casino founder apologizes for misusing investor funds. Galaxy reports ex-partner Richard Kim for embezzling $3.67 Million.

Richard Kim, the former CEO and founder of Zero Edge, has been accused by U.S. prosecutors of diverting roughly $3.8 million from the company’s seed-round proceeds into personal cryptocurrency trading and gambling, rather than building the blockchain-based casino app he had pitched to investors. According to the Southern District of New York, Kim later admitted in investor emails that he was “solely responsible for the loss of $3.67m” of the company’s balance sheet, but he allegedly continued to obscure the losses by describing them as a “treasury management strategy” instead of personal gambling losses. The case matters because Zero Edge was marketed as a crypto-native online casino backed by investor capital, making the alleged misuse of funds a high-profile example of fraud risk in the digital-asset startup sector. Prosecutors say the money moved through multiple crypto exchanges and a crypto casino account before the alleged losses were uncovered, and Kim now faces federal securities fraud and wire fraud charges, each carrying a maximum sentence of 20 years if convicted.

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