Blockchainย Tech security company CertiK postedย on May 4 that it has successfully blocked $160,000 in stolen funds from Merlin, a decentralized exchange accordingย to zkSync recently hit by a rogue insider rug pull. The fraudulent activity resulted in losses of $1.8 Million for users last week.
Reportsย by a Twitter thread issuedย on May 4, CertiK reiterated that insiders pulled the Merlin DEX rug. The blockchainย tech security company, onย theย otherย hand, indicatedย that its efforts to collaborate with Merlin to recover the funds were unsuccessful because the projectโs other team members were unwilling to verify their true identities.
The lack of participation has complicated the efforts to aid victims of the exploit. Still, CertiK is working with law enforcement in theย Unitedย States and the Unitedย Kingdom to reveal the identities of the pseudonymous operators inย chargeย of the rug pull.
CertiK believes the โrogue developersโ behind the scam are based in Europe. Reportsย by the company, the insiders at Merlin abused the ownerโs wallet privileges, which is consistent with its initial finding that theย challenge was related to a private key challenge rather than an exploit.
Merlin assertsย that the rug pull was carried out by its back-end team, whom they had put a โ highย level of trust in.โ
The zkSync-based decentralized exchange was compromised on April 25, severalย days after its launch. CertiK noted at the time that the project had โcentralization risksโ in its audit of the company.
Compensation strategy worth $2 Million announced for exit scam victims
The blockchainย tech security company admitted that it did not highlight this danger appropriately and that the centralized privileges should have been distinctly emphasized to make users aware of theย dangers. To prevent similar incidents in the future, CertiK pledged to prioritize centralization dangers in audit summaries to secure that users have a complete imageย of potential dangers. CertiK announced a compensation strategy worth $2 Million to cover the losses suffered by victims of the exit scam on April 27.
The security company has likewise pledged to use the funds toย assist prevent similar scams in the future and provide assistance to those influenced.
