Prominent XRP advocate and attorney, John Deaton, has expressed serious concerns regarding Linqto’s proposed refund strategies in the wake of the platform’s sudden account freezes earlier this year. Deaton cautioned that investors could face significant losses if Linqto decides to only refund the initial investment amounts, neglecting the profits generated from successful pre-IPO assets like Circle and Ripple.
Deaton highlighted the potential risks associated with such a decision in a recent X post, where he disclosed that his $30,000 investment in Circle through Linqto had grown to $157,000. This disparity could result in a loss of $120,000 for Deaton if he were to only receive his initial capital back. “That growth doesn’t belong to Linqto, it belongs to the investor,” Deaton emphasized.
The unexpected freezing of customer accounts and suspension of operations by Linqto on February 27 caught many users off guard, as reported by Globenews. Additionally, users voiced frustration over a new KYC process implemented by Linqto.
Despite these challenges, Linqto has maintained a low profile on social media, with its last post dating back to January 2025. The company has, however, communicated leadership changes, including the appointment of Dan Siciliano as CEO and the removal of several senior executives.
The recent lawsuit filed by former CRO Gene Zawroty against Linqto alleging market manipulation and fraud has prompted the company to focus on internal restructuring before addressing user grievances.
The lack of transparency and communication from Linqto has caused anxiety among users, especially those holding valuable shares in companies like Ripple. Deaton reiterated his stance against Linqto profiting from gains made using user funds, stating, “I didn’t invest for Linqto to walk away with the profits.”
Deaton emphasized the importance of distinguishing between failed ventures like Polysign, which may warrant refunds, and successful ones like Circle and Ripple, which should result in payouts to investors.
He cautioned users to be wary of individuals seeking to take advantage of distressed investors and urged them to assess any buyout or refund offers carefully.
In a recent tweet, Deaton hinted at an upcoming report exposing Linqto’s internal practices, further fueling speculation about possible mismanagement within the platform.
Rob Cunningham, founder of the advocacy group “Free Linqto,” revealed that investors suspect mishandling of reserves by Linqto may have contributed to the operational freeze. The platform, once lauded for providing retail investors access to high-profile pre-IPO equity, is now under intense scrutiny from over 14,000 users seeking clarity.
John Deaton had previously criticized Linqto for its silence amidst user complaints about frozen accounts and repetitive KYC demands. In response to the growing discontent, Deaton organized a Zoom meeting to discuss potential next steps, including the possibility of a class-action lawsuit.
The evolving situation with Linqto underscores the importance of transparency and accountability in the financial sector, especially when dealing with investors’ funds and assets. Investors must remain vigilant and informed to protect their interests in such uncertain circumstances.