The FinSoul Exit Scam: How Investors Lost $1.6 Million
The development team behind the gaming project FinSoul is facing allegations of carrying out a massive exit scam, defrauding investors of $1.6 million through market manipulation. According to CertiK, a blockchain security platform, the FinSoul team used paid actors to pose as executives and raised funds under the guise of developing a gaming platform. Instead of delivering on their promises, the team allegedly transferred the funds to themselves, leaving investors with nothing.
The Alleged Exit Scam and Money Laundering
The alleged exit scam involved the transfer of $1.6 million in bridged Tether (USDT) from investors to the FinSoul team. To conceal the origin of the funds, the developers reportedly laundered the money through a cryptocurrency mixer called Tornado Cash.
A History of Misconduct
This isn’t the first time that the FinSoul developers have faced accusations of misconduct. Earlier this year, another project called Fintoch claimed to have adopted advanced technology for developing the FinSoul metaverse platform. However, it was later revealed that Fintoch itself had performed an exit scam, allegedly stealing $31.6 million and attempting to launder the funds on the Tron blockchain.
Rebranding and Deceptive Tactics
In response to the allegations, CertiK claimed that the FinSoul team rebranded as “Standard Cross Finance (SCF)” in August. The security platform provided evidence showing that key executives from Fintoch and Standard Cross Finance were identical individuals who turned out to be actors from the entertainment industry.
Despite their tainted reputation, the rebranded Standard Cross Finance team continued promoting FinSoul on platforms like YouTube and Telegram, even organizing a promotional event in Vietnam to deceive investors further.
Market Manipulation Revealed by Blockchain Data
Blockchain data reveals market manipulation by the FinSoul project. On October 10, the project deployed its token contract on the BNB Smart Chain network, minting 100 million FinSoul (FSL) tokens. The deployer account retained 97 million FSL tokens after transferring a portion to other accounts. The price of FSL initially soared to $17.5774 before plummeting to nearly zero, coinciding with the transfer of the remaining tokens and the draining of $1.6 million worth of Binance-pegged USDT from the liquidity pool.
Continued Deception and Investor Confidence
Despite their alleged fraudulent activities, the Standard Cross Finance team has managed to convince investors to reinvest in their project. They have relaunched FSL with a new token contract currently valued at $1.29 per coin.
Hot Take: The FinSoul Scam Exposes Risks in the Crypto Industry
The FinSoul exit scam serves as a reminder of the risks associated with investing in the crypto industry. It highlights the importance of conducting thorough due diligence and verifying the legitimacy of projects and teams before investing your hard-earned money. The use of paid actors and market manipulation tactics demonstrate how malicious actors can exploit trust and manipulate markets for personal gain. As an investor, it’s crucial to stay informed, skeptical, and vigilant to protect yourself from such scams.
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