Blockchain investigator ZachXBT, known for his pseudonymous identity, recently issued a warning regarding a group of scammers who are attempting to ensnare more victims in a new fraudulent scheme involving millions of stolen funds.
In a thread on X, ZachXBT shared the results of an investigation into Leaper Finance, a lending protocol based on Blast. The analysis revealed that this group is responsible for several rug pulls, including those that targeted users of Magnate ($6.5 million), Kokomo ($4 million), Solfire ($4.8 million), and Lendora.
ZachXBT noted, “In the past, they allowed the Total Value Locked (TVL) to grow to seven figures before stealing all of the users’ funds deposited into the protocol. They also falsify Know Your Customer (KYC) documents and utilize low-tier audit firms. Now, they have launched scams on various platforms such as Base, Solana, Scroll, Optimism, Arbitrum, Ethereum, Avalanche, and more.”
Furthermore, it is believed that this group is also responsible for scams on Hash DAO, Glori Finance, and ZebraDAO, resulting in estimated losses of over $20 million.
As explained, a rug pull occurs when the developers of a blockchain-based protocol suddenly withdraw all of their funds from a liquidity pool or project wallet, essentially draining the investments made by others. This typically happens without any prior warning, leaving investors with worthless tokens or assets.
In their latest fraudulent endeavor, the group reportedly funded a Leaper Finance address on the Blast network with nearly $1 million laundered from previous scams, in an attempt to attract more victims by increasing liquidity.
Shortly after the connection between Leaper Finance and the scams was exposed, the group responded to ZachXBT, harassing him while announcing a “token launch.” They stated, “Nice work! My comrades here at Lazarus fear you yet admire you!” referring to the North Korean hacker group Lazarus. Subsequently, the Leaper Finance and Glori Finance accounts on X were deactivated, and their respective websites have gone offline.
According to a research report published by blockchain security firm Immunefi on February 29, within the first two months of 2024, a total of $200 million worth of cryptocurrency was lost to hacks and rug pulls across 32 separate incidents.
In conclusion, it is crucial for investors to exercise caution when engaging with Solana memecoins, as they are susceptible to various dangers, including scams and rug pulls.
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