Investors lose $2.7 million as multiple on-chain projects rug pull

PeckShield Inc, a blockchain security company, identified a series of rug pulls in cryptocurrency projects on Friday. A ‘rug pull’ is when fraudulent developers lure investors to projects, only to con market participants and disappear with funds, leaving the token worthless. These sorts of crimes are now rampant in the crypto ecosystem. 

PeckShield reports rug pull scams

In a series of tweets on the social media platform X, PeckShield identified a total of $2.7 million in rug pulls by malicious developers. 

The firm alerted traders that some of the rug pull tokens imitate and have the same name as legitimate assets on the blockchain. It's therefore important to note the difference between the worthless asset and the original one that holds value and is legitimate.

RepubliK (RPK) suffered a 100% decline in its price as the exploiter swapped 100 quintillion (100,100,100,100,100,100,100.1001 RPK) tokens for $236,000 in wrapped BNB (WBNB) – ‘wrapping’ is a term used to describe the process by which tokens can be swapped for each other across different protocols.

The exploiters of the fake version of TrustPad (TPAD), and Dark Protocol (DARK), GigaDAO (GIGS) and Web (WEB) exchanged the tokens for $928,800 in WBNB. These tokens lost 100% of their value nearly instantly.

Creso (CRE), DigiFund (DFUND), Changpeng Zhao (CZ), Jewels (JWL), Papabear (PAPA), AI Surf (AISC) and Squid Game (SQUIDGAME), are other tokens that were targets of rug pull scams, according to PeckShield’s report.

The developers exchanged these tokens for wrapped BNB and ETH, for a total of $2.7 million. The holders of the affected tokens are left with tokens that have no exchange value.

In its original report, PeckShield also included the token IPMB (IPMB) on the list as the team behind it pulled liquidity from the pool on Binance Chain, sending the token's price to zero. However, IPMB told FXStreet that, following the incident, the token migrated from the Binance Chain to Polygon and reimbursed users. On-chain data from PolygonScan and BSCScan confirms the new IPMB token’s deployment on Polygon and its distribution to different wallet addresses. 

(This story was updated on October 15, 2024, to reflect that the IPMB token was removed from the original PeckShield list and that the team behind the project reimbursed users.)