Linqto Freezes Accounts: John Deaton Sounds Alarm—Investors Risk Losing $120K+ in Unrealized Gains

Another day, another crypto platform playing gatekeeper with user funds. Linqto’s abrupt account freezes have left investors scrambling—and high-profile attorney John Deaton isn’t mincing words.

Locked Out, Liquidated Out

Deaton’s warning cuts through the noise: six-figure profits are now trapped in financial purgatory. The $120K+ at stake? Just the latest reminder that ‘your keys, your crypto’ remains more ideal than reality.

The Fine Print Giveth, The Platform Taketh Away

Terms of service strike again. While Linqto’s move may be technically legal, it’s a brutal lesson in centralized risk—the kind that makes TradFi’s 3-day settlement delays look quaint.

Cynical Take
: Nothing unites crypto and traditional finance like finding new ways to separate investors from their money.

Linqto Refund Plans Would Not Favor Investors

In his X post, Deaton emphasized the danger of such a move. He revealed that his $30,000 investment in Circle through Linqto had appreciated to $157,000.

Regrading Linqto, it depends on the investment, I guess. If people got their money back for Polysign it would be a great deal because Polysign is worthless.

But what about Ripple and Circle?

I invested $30K in Circle on the @linqtoinc platform. My investment today is worth… https://t.co/wnXQlyBa40

This indicates a potential $120,000 loss if he were refunded solely his initial capital. “That growth doesn’t belong to Linqto, it belongs to the investor,” Deaton asserted.

For context, Linqto users were blindsided when the platform froze customer accounts and ceased operations on February 27, according to Globenews. Additionally, many Linqto users expressed frustration over a new KYC process.

Frozen….
Keeping an eye on this one… all customer assets have been frozen since start of 2025.

Now what @linqtoinc – no communications with customers either?

Shady business if you ask me. A lot of speculations and linqto client relations team and company silent… https://t.co/hvUvgsbQ3H

Yet, Linqto has remained mostly silent on social media, with its last post in January 2025. Instead, the company has sent emails confirming leadership changes, including Dan Siciliano’s appointment as CEO and the removal or termination of several senior executives.

This shake-up follows a lawsuit from former CRO Gene Zawroty accusing Linqto of market manipulation and fraud. Linqto seems focused on fixing internal problems before addressing user complaints.

Lawsuit against Linqto, Bill Sarris & Joe Endoso details emerging.
Insider Trading/Front Running.
Use of unlicensed brokers.
Linqto advertised 750k users, when the real number was 10k & 30% were UNaccredited.
Unconscionably high and undisclosed mark-ups, sometimes… pic.twitter.com/gWvv9a0Xk6

The silence and lack of clear communication resulted in fears across the user base, particularly among investors holding valuable shares in companies like Ripple, which reportedly offered a buyback at $175 per share in June, well above many investors’ entry price.

Deaton has made it clear he won’t support any resolution that sees Linqto profiting from gains made using user capital. “I didn’t put my money in so Linqto could walk away with the profits,” he said.

Failed Ventures Deserve Refunds, Profitable Ones Deserve Payouts

While acknowledging the frustration among affected investors, Deaton drew a distinction between failed projects and successful ones.

He pointed to Polysign as an example of a failed investment, where a refund might make sense. However, lumping in profitable ventures like Circle and Ripple under the same refund umbrella WOULD be deceptive, he argued.

Deaton also warned users to be cautious of opportunists looking to exploit emotionally distressed investors.

“Don’t sell out of fear,” he urged, encouraging careful evaluation before accepting any buyout or refund offer that undervalues their current holdings.

Adding fuel to the growing tension, Deaton hinted that a major report exposing Linqto’s internal practices is set to drop soon. He described the situation as a “clusterfuck,” further stoking speculation about mismanagement or worse.

FYI, a story, regarding the @linqtoinc clusterfuck (that’s exactly what it is now) is likely to be published by a MAJOR publication in the very NEAR future – possibly even before Tuesday’s Spaces. Stand by. https://t.co/L8qQtyogiM

According to Rob Cunningham, founder of the advocacy group “Free Linqto,” investors suspect that the platform’s reserves may have been mishandled, contributing to the operational freeze.

The company, once praised for giving retail investors access to high-profile pre-IPO equity, including a notable 3% stake in Ripple Labs is now facing intense scrutiny from more than 14,000 users seeking answers.

Also, John Deaton had earlier criticized Linqto for its ongoing silence amid user complaints about frozen accounts and repeated KYC demands.

Linqto has not responded to my email. I have received several emails and DMs from folks who are understandably concerned and pissed off about the lack of communication. Many Linqto customers, me included, joined the XRP class against the SEC in the @Ripple case and provided… https://t.co/7mWoFN0uPL

In an April post on X, Deaton revealed he’s received numerous messages from frustrated customers and scheduled a Zoom meeting for March 27 at 6 p.m. EST to discuss possible next steps.

He hinted at a potential class action lawsuit, noting many affected users had previously joined him in the SEC vs. Ripple case.