$400,000 in WBNB Stolen in Project RugPull

Infinity token was less than a week old before the funds were stolen and the project was shut down.

On January 26 the price of Infinity token unexpectedly crashed from $0.02 down to $0. Cryptocurrency security analyst Peckshield was quick to post on Twitter showing that the project owners had used smart contracts to steal all the funds that were supposed to be locked.

Before the rug pull, there was more than 1000 wallet holders and more than $400,000 worth of Wrapped Binance Coin (WBNB) in the project. The stolen funds were all sent through Tornado Cash, a mixing application that attempts to hide funds from viewers of the blockchain.

This scam project was hosted on Binance Smart Chain which has come under some scrutiny for the number of fake projects it hosts.

Information about this project is hard to find as they have removed their websites, social media and closed their communities.

In cryptocurrency, a rug pull is a type of scam which instantly makes a project’s token valueless by removing all liquidity from the markets. These scams utilize decentralized exchanges and pair their token with common cryptocurrencies, such as Binance Coin (BNB).

As more users buy the scam token, the amount of BNB in the liquidity pool increases as the amount of scam token decreases. The team will then remove all liquidity from the pool and sell the BNB. Once liquidity has been removed, the scam token will be illiquid and valueless.

There will likely be an investigation into the matter as many users were affected by the scam. These types of scams have been very prevalent in recent years and not many scammers have been caught.

So far, no one on Twitter has managed to find the real identity of the project owners but crypto enthusiasts will attempt to help unmask the criminals.

Many communities have been founded to aid in catching scammers and help victims, in an effort to deter future scammers and clean up the industry.

These types of scams are one of the main reasons political leaders have raised concerns over decentralized finance.

Tens of millions of dollars have been stolen over the last 12 months from rug pull projects alone. Without decentralized exchanges, these types of scams would not be possible as a centralized authority would control the liquidity.

Source

Updated: 02/01/2022 — 08:00