Scammers Deceive 42,000 Victims and Collect $32 Million
A group of fraudsters has successfully scammed over 42,000 victims and accumulated a staggering $32 million through a series of crypto scams that started in April 2023.
Unique Scam Technique Fooled Rug Pull Detectors
What sets this scam apart is the use of a method that even fooled some of the industry’s renowned “rug pull detectors,” as revealed by blockchain security firm Blockfence.
Tokens Impersonating Crypto Projects Exploit FOMO
Typically, scammers create tokens that impersonate upcoming crypto projects and take advantage of the fear of missing out (FOMO) to attract unsuspecting investors.
Manipulating Token Supply and Bait-and-Switch Tactics
The scammers manipulate the maximum token supply through minting and burning, along with a code bait-and-switch tactic to deceive victims while evading rug pull detectors.
Injecting Fake Liquidity to Create Illusion of Legitimacy
The scammers inject fake liquidity into the scam project, creating the illusion of legitimate volume in liquidity pools on Ethereum-based decentralized exchanges like Uniswap.
Scammers Use Lock Function to Deceive Investors
To further deceive investors, the scammers implement a lock() function on the LP tokens to give the impression that rug pulling will be prevented.
Token Burning and Deception
The scammers artificially inflate the price of the fake token through wash trading and then execute the setUserBalance function to technically burn the token, making it impossible to sell. However, the token remains visible in the victim’s wallet, adding to the deception.
Contract Owner Renounces Ownership to Bypass Detectors
The scammers renounce ownership of the token contract, which can bypass certain detector tools and mislead victims who purchase the token.
Meme Coin Mania Exploited for Fake Tokens
The scammers impersonate popular meme coins like Wisealth, RabbitRun, DreamFi, and create tokens with similar names to exploit the memecoin trend.
Decline in Crypto Hacking Incidents in 2023
In 2023, there was a slight decline in hacking incidents targeting the cryptocurrency industry, with hackers managing to pilfer $2 billion in digital assets throughout the year, according to a report from De.FI.
Hot Take: Scammers Exploit Memecoin Mania to Defraud Thousands
A group of scammers has devised a sophisticated method to deceive over 42,000 victims and accumulate a staggering $32 million through a series of crypto scams. This unique scam technique managed to fool even renowned rug pull detectors. By creating tokens that impersonate upcoming crypto projects and exploiting the fear of missing out (FOMO), the scammers manipulated token supply and used bait-and-switch tactics to effectively deceive investors. They injected fake liquidity into their scam projects and implemented a lock function to give the impression of preventing rug pulling. The scammers also burned tokens while keeping them visible in victims’ wallets. By renouncing ownership of the token contract, they bypassed detection tools. Additionally, they exploited the meme coin mania by impersonating popular meme coins. Despite a slight decline in hacking incidents in 2023, these scams serve as a reminder for investors to exercise caution and conduct thorough research before investing in cryptocurrencies.
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