Cryptocurrency, News & Updates

Founders of $50M Ethereum coin “rug pull” its Users

Meanwhile, the Ethereum decentralized finance space had dramatically cooled down since August and September; space is still filled with scammers. Truthfully, connected to the number of legitimate projects launching, it seems that there is a large number of scams.

This has been made clear when a DeFi project had “rug-pulled” its users notwithstanding building an aura of trust in over many months. The coin pertains to the project that has plunged to 99 percent, and it surprised many investors.

Some Ethereum DeFi scams in the past few months have taken place over a few days. Usually, a malicious actor has launched the smart contracts with an ability to mint an unlimited number of tokens or to steal credits, produce hype through Twitter and sides like 4chan, and then quickly “pull the rug” by using their exploit. The process has taken over in mere hours in September; the blockchain analyst has recorded a single wallet in doing it multiple times a day to make hundreds of ETH.

It means that many investors are becoming adapted to stick with former projects, those who have an established community product and vision.

The CoinBreeder/CBDAO, which token is BREE, was such a project.

CoinBreeder was a multi-faceted Ethereum project that included the features related to non-fungible tokens (NFTs) and staking.

For some reason, the project has seen an immediate success: weeks after it has launched in early August, BREE tokens have an aggregate market capitalization of $50 million – quite the feat for a project that has just launched. There were many Ethereum token traders on Twitter commenting on the project, further noting that they thought it was a potentially good bet.

But in the past week, the project has become a scam.

As it was pointed out, an admin wallet has exploited a hidden backdoor in a BREE contract that allows them to dump 50,000 coins on the open market. The sale’s return was only approximately 200 ETH, and a million worth of ETH generated in a presale has been counted as good as gone. The project’s website, Twitter, and Telegrams have been pulled.

The price of BREE has subsequently deserted to a few cents from its $50 all-time high. Luckily, the admin address that has executed this scam has purportedly has connected his address to addresses affiliated with top exchanges Bittrex and Binance. This has allowed many law enforcement to find the individuals behind the hoax.

It is worth noting that CBDAO is far from being dead. Other users are trying to regain what is left to try and make the development into a success.

From whatever the case, this has displayed that even longer-standing Ethereum DeFi coins may not have been as genuine as they claim to be.

Far-off from the only swindle

BREE is only one of the numerous DeFi-related scams that have taken place in a few months.

As it has been reported, there was a “yield farm” that has managed to ditch thousands of dollars of Uniswap’s UNI from its users.

There also have been other longer-standing projects like HatchDAO that have scammed the users after building up an aura of trust in over many weeks.

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