Another Base Layer-2 Scam: Magnate Finance Exit Scams with $6.5 Million
Following the recent rug-pull of $23 million in BALD token liquidity, Coinbase’s Base layer-2 network has faced another setback as Magnate Finance exit scammed with $6.5 million. The security firm PeckShield has reported that Magnate Finance used price oracle manipulation to carry out the heist. As a result, the platform’s total value locked has plummeted from $6.51 million to just under $14,000.
Key Points:
- Magnate Finance used price oracle manipulation of DAI and wETH for the scam.
- The platform’s total value locked dropped from $6.51 million to under $14,000.
- The website and Telegram group of Magnate Finance are offline, and the deployer’s address is connected to the Solfire $4.8M exit fraud.
- Solfire.Finance previously scammed over $3 million and removed its website and social media accounts.
- Base layer-2 network has become a breeding ground for scams, with previous incidents involving RocketSwap and Encryption AI.
The crypto sector has witnessed significant advancements but is also plagued by various challenges. Coinbase’s Base layer-2 network, which aimed to offer a more scalable and user-friendly Ethereum network, has attracted several bad actors seeking easy targets. Encryption AI serves as a cautionary tale after losing $2 million in a rug pull. Solidus Labs discovered over 500 scam tokens deployed on the blockchain, with deceptive functions and hidden fees. Another notable rug pull involved the token BALD, which manipulated its price and volume on LeetSwap to secure $5.2 million.
Hot Take:
The repeated rug pulls and exit scams on Coinbase’s Base layer-2 network raise serious concerns about its security and reputation. Crypto users must exercise caution and conduct thorough research before engaging with any projects on the network. It is crucial for the crypto community to demand enhanced security measures and transparency to prevent such incidents in the future.
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