The developers of Blur Finance, a yield aggregator based on the BNB chain and Polygon, have ditched the project and deleted its social media channels.
During the process, more than $600,000 worth of tokens disappeared, according to security firm PeckShield today.
With more than 754 holders on the BNB chain, Blur’s integration with Polygon provided annualized yields of around 4,000% as of last week. After the rug pull, Blur’s BLR token fell 99%.
A rug pull is a scam undertaken by developers working on decentralized finance (DeFi) applications.
Social media marketing is used to glorify and sensationalize a token before listing it on a decentralized exchange (DEX).
Typically, after investors buy a token swayed by the popularity in the marketplace, developers will shut down the protocol and vanish, keeping the funds for themselves.
This move is not uncommon in the industry and liquidity pulls aimed at stealing money from investors often take place.
In January, eight people were arrested in China for a rug pull in June 2021. And, more recently, Dragoma, the Polygon-based Web3.0 game was subject to a rug pull losing $3.5m.
Additionally, a Chainalysis report estimated that rug pulls in the industry amounted to around $2.6bn just in 2021.
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