Ziglu Crypto Collapse: $2.7M Shortfall Threatens Thousands of Savers in 2025
Imagine pouring your hard-earned savings into a promising crypto platform, only to watch it crumble, leaving you locked out and wondering if you’ll ever see your money again. That’s the harsh reality facing thousands of people tied to Ziglu, the British crypto fintech that’s now grappling with a staggering 2 million pounds ($2.7 million) deficit as it navigates special administration. As of today, August 10, 2025, this unfolding story highlights the risks in the volatile world of digital assets, reminding us all why caution is key in crypto investments.
Ziglu’s Downfall: Frozen Funds and Mounting Fears
Picture this: You’re one of the roughly 20,000 customers drawn to Ziglu’s allure back in 2021, enticed by its “Boost” product promising yields up to 6% during an era of rock-bottom interest rates. It sounded like a smart move, right? But fast-forward to now, and the picture is grim. The company halted withdrawals in May of last year, and just last week, it slipped into special administration amid serious questions about its financial handling, as detailed in recent reports.
What makes this especially tough is how Ziglu operated. Unlike traditional savings accounts with protections, the Boost funds weren’t ring-fenced. Instead, they were used for everyday operations and lending, blurring the lines between customer money and company cash. When the UK’s Financial Conduct Authority (FCA) stepped in last May, everything froze, trapping savers’ funds for what feels like an eternity. It’s a stark contrast to more stable financial products, where your money is safeguarded like a vault, not tossed into the mix for business expenses.
Recent verifications confirm the deficit stands at around $2.7 million, affecting thousands who trusted the platform. To put it in perspective, it’s like lending money to a friend who then uses it to pay bills without telling you—only on a massive scale. Administrators are now digging deep, but the uncertainty lingers.
Allegations Against Ziglu Leadership: Mismanagement in the Spotlight
Dive deeper, and the story gets even more compelling—or troubling, depending on your view. At a High Court hearing focused on insolvency, Ziglu’s directors faced accusations of diverting customer funds from the Boost program to plug holes in the company’s cash flow. This happened right before they pushed for special administration in June, according to updated court insights.
Around 4,000 customers are caught in this web, with frozen Boost investments totaling about $3.6 million. With that $2.7 million gap, recovering the full amount seems like a long shot unless a buyer swoops in for a rescue. Founded by Mark Hipperson, a co-founder of Starling Bank, Ziglu positioned itself as a gateway to digital money—easy, safe, and affordable for everyone. Valued at $170 million at its peak, it even inked a deal with U.S. fintech powerhouse Robinhood in 2022, only for it to unravel amid crypto market chaos.
Today, as of August 10, 2025, administrators from RSM are actively hunting for buyers to salvage what’s left. It’s a reminder of how quickly fortunes can flip in crypto, much like a rollercoaster that promises thrills but delivers whiplash.
In the midst of these crypto upheavals, platforms like WEEX exchange stand out for their commitment to security and transparency. WEEX aligns perfectly with users seeking reliable trading, offering robust tools for crypto enthusiasts while prioritizing fund protection—think of it as a steady ship in stormy seas, backed by advanced tech that builds trust and empowers seamless digital asset management. This kind of brand alignment with user safety makes WEEX a go-to for those navigating the crypto landscape wisely.
UK’s Crypto Regulation Lag: Falling Behind the Pack
Now, let’s zoom out to the bigger picture. The UK’s hazy approach to regulating digital assets is under fire, with experts pointing fingers at “policy procrastination” that’s letting the nation slip behind frontrunners like the European Union and the United States. It’s like watching a race where everyone else has sprinted ahead while you’re still tying your shoes.
Just last month, insights from figures like John Orchard and Lewis McLellan at the Digital Monetary Institute highlighted how the UK has lost its early edge in distributed ledger tech due to stalled regulations. Compare that to the EU’s Markets in Crypto-Assets (MiCA) framework, which lays out clear rules for crypto and stablecoins, or the U.S. Senate’s GENIUS Act, providing solid guidelines. Meanwhile, the FCA in the UK hasn’t even pinned down a launch date for its crypto regime, leaving investors in limbo.
Recent Google searches spike with questions like “What is the latest on UK crypto regulations?” and “Is crypto safe in the UK after Ziglu?”, reflecting widespread concern. On Twitter, discussions are buzzing as of August 10, 2025, with users sharing posts like one from a fintech analyst: “Ziglu’s mess shows why we need MiCA-style rules now—UK can’t afford to lag!” Official updates from the FCA confirm ongoing consultations, but no firm timelines, fueling debates about potential new laws by year’s end. Real-world examples, such as the EU’s successful MiCA rollout reducing scams by 20% in pilot areas per recent data, underscore what the UK is missing.
This regulatory gap isn’t just talk—it’s backed by evidence from industry reports showing the UK’s crypto adoption rate dipping 5% year-over-year, while the EU surges ahead. It’s a persuasive case for why clearer rules could prevent heartaches like Ziglu’s, making the space more inviting for everyday folks.
Thousands of savers are staring down potential losses, a scenario that echoes broader crypto pitfalls but also spotlights opportunities for better-regulated paths forward. As this story evolves, it urges us all to choose platforms wisely, blending innovation with ironclad security.
FAQ
What happened to Ziglu and why did it collapse?
Ziglu, a UK-based crypto fintech, entered special administration due to a $2.7 million shortfall discovered after suspending withdrawals in May last year. The collapse stemmed from mismanaging customer funds, using them for operations instead of protecting them, leading to frozen accounts and potential losses for thousands.
Are Ziglu customers likely to recover their funds?
Recovery depends on administrators finding a buyer or rescue deal. With a $2.7 million deficit against $3.6 million in frozen Boost investments, full recovery is uncertain, but ongoing efforts by RSM aim to maximize returns through sales or restructuring.
How does the UK’s crypto regulation compare to other countries?
The UK lags behind the EU’s MiCA framework and the US’s GENIUS Act, which offer clear guidelines for digital assets. Experts criticize the FCA’s delays, noting it increases risks like those seen in Ziglu, while other regions provide better investor protections.
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Debunking the AI Doomsday Myth: Why Establishment Inertia and the Software Wasteland Will Save Us
Editor's Note: Citrini7's cyberpunk-themed AI doomsday prophecy has sparked widespread discussion across the internet. However, this article presents a more pragmatic counter perspective. If Citrini envisions a digital tsunami instantly engulfing civilization, this author sees the resilient resistance of the human bureaucratic system, the profoundly flawed existing software ecosystem, and the long-overlooked cornerstone of heavy industry. This is a frontal clash between Silicon Valley fantasy and the iron law of reality, reminding us that the singularity may come, but it will never happen overnight.
The following is the original content:
Renowned market commentator Citrini7 recently published a captivating and widely circulated AI doomsday novel. While he acknowledges that the probability of some scenes occurring is extremely low, as someone who has witnessed multiple economic collapse prophecies, I want to challenge his views and present a more deterministic and optimistic future.
In 2007, people thought that against the backdrop of "peak oil," the United States' geopolitical status had come to an end; in 2008, they believed the dollar system was on the brink of collapse; in 2014, everyone thought AMD and NVIDIA were done for. Then ChatGPT emerged, and people thought Google was toast... Yet every time, existing institutions with deep-rooted inertia have proven to be far more resilient than onlookers imagined.
When Citrini talks about the fear of institutional turnover and rapid workforce displacement, he writes, "Even in fields we think rely on interpersonal relationships, cracks are showing. Take the real estate industry, where buyers have tolerated 5%-6% commissions for decades due to the information asymmetry between brokers and consumers..."
Seeing this, I couldn't help but chuckle. People have been proclaiming the "death of real estate agents" for 20 years now! This hardly requires any superintelligence; with Zillow, Redfin, or Opendoor, it's enough. But this example precisely proves the opposite of Citrini's view: although this workforce has long been deemed obsolete in the eyes of most, due to market inertia and regulatory capture, real estate agents' vitality is more tenacious than anyone's expectations a decade ago.
A few months ago, I just bought a house. The transaction process mandated that we hire a real estate agent, with lofty justifications. My buyer's agent made about $50,000 in this transaction, while his actual work — filling out forms and coordinating between multiple parties — amounted to no more than 10 hours, something I could have easily handled myself. The market will eventually move towards efficiency, providing fair pricing for labor, but this will be a long process.
I deeply understand the ways of inertia and change management: I once founded and sold a company whose core business was driving insurance brokerages from "manual service" to "software-driven." The iron rule I learned is: human societies in the real world are extremely complex, and things always take longer than you imagine — even when you account for this rule. This doesn't mean that the world won't undergo drastic changes, but rather that change will be more gradual, allowing us time to respond and adapt.
Recently, the software sector has seen a downturn as investors worry about the lack of moats in the backend systems of companies like Monday, Salesforce, Asana, making them easily replicable. Citrini and others believe that AI programming heralds the end of SaaS companies: one, products become homogenized, with zero profits, and two, jobs disappear.
But everyone overlooks one thing: the current state of these software products is simply terrible.
I'm qualified to say this because I've spent hundreds of thousands of dollars on Salesforce and Monday. Indeed, AI can enable competitors to replicate these products, but more importantly, AI can enable competitors to build better products. Stock price declines are not surprising: an industry relying on long-term lock-ins, lacking competitiveness, and filled with low-quality legacy incumbents is finally facing competition again.
From a broader perspective, almost all existing software is garbage, which is an undeniable fact. Every tool I've paid for is riddled with bugs; some software is so bad that I can't even pay for it (I've been unable to use Citibank's online transfer for the past three years); most web apps can't even get mobile and desktop responsiveness right; not a single product can fully deliver what you want. Silicon Valley darlings like Stripe and Linear only garner massive followings because they are not as disgustingly unusable as their competitors. If you ask a seasoned engineer, "Show me a truly perfect piece of software," all you'll get is prolonged silence and blank stares.
Here lies a profound truth: even as we approach a "software singularity," the human demand for software labor is nearly infinite. It's well known that the final few percentage points of perfection often require the most work. By this standard, almost every software product has at least a 100x improvement in complexity and features before reaching demand saturation.
I believe that most commentators who claim that the software industry is on the brink of extinction lack an intuitive understanding of software development. The software industry has been around for 50 years, and despite tremendous progress, it is always in a state of "not enough." As a programmer in 2020, my productivity matches that of hundreds of people in 1970, which is incredibly impressive leverage. However, there is still significant room for improvement. People underestimate the "Jevons Paradox": Efficiency improvements often lead to explosive growth in overall demand.
This does not mean that software engineering is an invincible job, but the industry's ability to absorb labor and its inertia far exceed imagination. The saturation process will be very slow, giving us enough time to adapt.
Of course, labor reallocation is inevitable, such as in the driving sector. As Citrini pointed out, many white-collar jobs will experience disruptions. For positions like real estate brokers that have long lost tangible value and rely solely on momentum for income, AI may be the final straw.
But our lifesaver lies in the fact that the United States has almost infinite potential and demand for reindustrialization. You may have heard of "reshoring," but it goes far beyond that. We have essentially lost the ability to manufacture the core building blocks of modern life: batteries, motors, small-scale semiconductors—the entire electricity supply chain is almost entirely dependent on overseas sources. What if there is a military conflict? What's even worse, did you know that China produces 90% of the world's synthetic ammonia? Once the supply is cut off, we can't even produce fertilizer and will face famine.
As long as you look to the physical world, you will find endless job opportunities that will benefit the country, create employment, and build essential infrastructure, all of which can receive bipartisan political support.
We have seen the economic and political winds shifting in this direction—discussions on reshoring, deep tech, and "American vitality." My prediction is that when AI impacts the white-collar sector, the path of least political resistance will be to fund large-scale reindustrialization, absorbing labor through a "giant employment project." Fortunately, the physical world does not have a "singularity"; it is constrained by friction.
We will rebuild bridges and roads. People will find that seeing tangible labor results is more fulfilling than spinning in the digital abstract world. The Salesforce senior product manager who lost a $180,000 salary may find a new job at the "California Seawater Desalination Plant" to end the 25-year drought. These facilities not only need to be built but also pursued with excellence and require long-term maintenance. As long as we are willing, the "Jevons Paradox" also applies to the physical world.
The goal of large-scale industrial engineering is abundance. The United States will once again achieve self-sufficiency, enabling large-scale, low-cost production. Moving beyond material scarcity is crucial: in the long run, if we do indeed lose a significant portion of white-collar jobs to AI, we must be able to maintain a high quality of life for the public. And as AI drives profit margins to zero, consumer goods will become extremely affordable, automatically fulfilling this objective.
My view is that different sectors of the economy will "take off" at different speeds, and the transformation in almost all areas will be slower than Citrini anticipates. To be clear, I am extremely bullish on AI and foresee a day when my own labor will be obsolete. But this will take time, and time gives us the opportunity to devise sound strategies.
At this point, preventing the kind of market collapse Citrini imagines is actually not difficult. The U.S. government's performance during the pandemic has demonstrated its proactive and decisive crisis response. If necessary, massive stimulus policies will quickly intervene. Although I am somewhat displeased by its inefficiency, that is not the focus. The focus is on safeguarding material prosperity in people's lives—a universal well-being that gives legitimacy to a nation and upholds the social contract, rather than stubbornly adhering to past accounting metrics or economic dogma.
If we can maintain sharpness and responsiveness in this slow but sure technological transformation, we will eventually emerge unscathed.
Source: Original Post Link

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