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Andre Cronje, Blue Kirby, DeFi, Defi rug pull, defi scam, github, LP token, pre-sale, Sam Bankman-Fried, smart contract, total value lock-in, YFI
The continued hype about the abnormally high returns of Defi tokens naturally attracted more investors to transfer funds to decentralized protocols. As of October 10, the total value locked in the Defi agreement was close to 11 billion U.S. dollars. However, despite the obvious recognition of Defi, the carpet incident and outright scam now seem to be disrupting the field.
News.bitcoin.com has been reporting on the increasing popularity of the Defi protocol and has exposed the fact that some developers and founders deliberately engaged in behaviors that harm the interests of the emerging Defi community.
Just recently, Sam Bankman Fried (SBF), the staff member who took over SushiSwap in early September, was accused of unethical conduct. These allegations stem from SBF’s use of FTT (centralized token) as collateral for short-selling other assets. Facts have proved that SBF’s actions have not been recognized by the community, and the report indicates that the issue will be resolved through a vote that ends on October 14.
However, before the vote was over, critics argued that if “economically reasonable market participants (such as SBF) can use these tools in ways that are not approved by the community, then the market and the immaturity of the market will be ineffective. Mature.” Its users were exposed. “
At the same time, the SBF defending its actions is not the only influencer criticized for using privileged positions to enrich itself. YFI fanatic Blue Kirby is another outstanding figure who has been widely criticized for actively promoting Andre Cronje’s bad EMN before being hacked. Second, when Defi tokens have suffered losses in the past few weeks, Kirby faces charges of abandoning its YFI.
The complaints against SBF and Blue Kirby are just two of many influential individuals accused of violating the values they publicly embrace. However, in many cases, Defi con artists were only exposed after escaping from millions of dollars in investor funds. According to the Boxmining newsletter, some Defi projects or tokens are listed under News.bitcoin.com, which proved to be scams.
money: After collecting 2500 Ether from investors, the carpet was withdrawn. According to the message left on the website, the Amplyfi.money team claimed that “one of the developers broke the wallet and was able to use a little-known vulnerability in the compiler itself.” It added: “Developers are under considerable threats , So we decided to terminate the project.”
Beer Garden Finance: According to the newsletter, the founder holds more than 50% of the token supply in his personal wallet. When the community asks for more detailed information, such as the Github link of the project or the time lock of the token, they are prohibited from being obtained from the Telegram group.
Burn Vault Finance ($BFV): The communication said that the team behind this agreement carpet withdrew. News.bitcoin.com also confirmed that the community Telegram account is no longer valid.
CBDAO ($BREE): According to the newsletter, the project pre-sold $SBREE tokens, which will be exchanged for $BREE. An administrator wallet used the back door in the SBREE token contract to mint 50,000 SBREE. Since then, SBREE was converted to BREE and sold on the market, thereby reducing the price of BREE, but at the expense of other holders. The price of 50,000 BREE is less than 200 ETH.
Degenballz: The Boxmining newsletter says that placing a bet “may steal 1% of your LP tokens.” On Twitter, A user seems to complain about paying a 1% LP equity fee to the developer. The user named HuntingtheCoins was disappointed by the fact that it had not been disclosed in advance.
Emerald Mine (EMD): According to the newsletter, it is said that nearly $2.5 million worth of user tokens that have been locked under the smart contract have been moved to another account. Fortunately, the cryptocurrency exchange Changenow managed to stop the sale of 135,020 EOS. However, this is only a small part of the total stolen funds.
Finance: Falsified audit results, after investors discovered that they could not withdraw funds after depositing funds. The team has since disappeared, and the site has been closed at the time of writing.
Minion Farm: When you connect your wallet to the Minions e-wallet website, Minions will access all your assets. According to the message left on the Minions Farm page on “Medium”, the post was investigated for alleged violation of publishing rules. At the time of writing, the official website is also closed.
Tomato Finance: The newsletter stated that a hacker allegedly triggered the simple permission grant and withdrew the token. News.bitcoin.com observed that there has been no activity on their “medium” page since September 23.
UniCat ($MEOW): The backdoor of the smart contract enables UniCat to control the user’s token even if the user token is withdrawn from the pool. It is said that cryptocurrency worth about $200,000 was stolen.
Unirocket ($URCKT): The newsletter stated that the creator of this token was dragged out rudely and cannot be found on social media now. Similarly, News.bitcoin.com could not find any information on Unirocket on social media.
Finance: Project went through a two-day promotion on Twitter, received a total of $20 million in investor funds, and then disappeared. News.bitcoin.com reported on the Yfdex.finance scam in September.
From the list, potential Defi token investors can see the common methods and strategies used by fraudsters to defraud funds. Due to the absence of regulations and the fact that most tokens are issued by anonymous entities, once fraudulently, investors have no chance to recover lost funds.
In the medium and long term, continuous carpet-pull incidents will undermine people’s perception that decentralized finance can be a panacea to solve the problem of long-term financial exclusion. Influential people and community leaders have an obligation to solve these problems, because doing so is the only way to maintain public interest in Defi. More importantly, such efforts can help regulators avoid implementing restrictive rules that restrict further growth.
Do you think Defi will be spared? Share your views in the comments section below.
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