New Rug Pull Event Explodes: This Altcoin Goes To Zero!

Random altcoin exploits and ‘rug-pull’ have become commonplace on the BNB Blockchain. Blockchain security platform PeckShield has detected a new scam on BNB Chain. After the emergence of the rug-pull, the altcoin price zeroed vertically.

They pulled the carpet, altcoin price reset!

Koindeks.com As you follow, the crypto money market frequently encounters hacking and fraud events. Now, one more has been added to them. Blockchain security platform PeckShield has detected a $17 million rug-pull incident from the FLARE project. However, the scam project has only name resemblance to Flare Networks. The altcoin price, which was at $ 25 before the rug-pull, then went below zero. PeckShield shared the following along with the price chart of the relevant altcoin project:

FLARE seems to be dump dumped/exploded.

PeckShield also noted that 4,000 BNB, which was the subject of fraud, was tried to be lost through Tornado Cash.

Stolen funds/loss is approximately $17 million. Of these, 4,000 BNB is laundered through TornadoCash.

What you need to know about rug-pull

In a carpet draw, their project’s tokens are pumped before a lineup disappears with the funds. The scammers then disappear, leaving their investors a worthless asset. When rogue developers create a new crypto token, it first starts raising the price. It saves as much money as possible before leaving the project. Then the carpet pull takes place and the corresponding altcoin price drops to zero. So, carpet pull processes are a kind of ‘exit scam’ and a decentralized finance (DeFi) exploit.

Before learning how to detect a carpet pull in crypto and why crypto carpet pulls occur, it helps to understand the three different types of carpet pulls. There are three main types of carpet pulling in crypto: liquidity stealing, limiting sell orders, and dumping.

Liquidity theft

Liquidity theft happens when token creators withdraw all tokens from the liquidity pool. Doing so removes all the security injected into the currency by investors, bringing its price to zero. These ‘liquidity withdrawals’ often happen in DeFi environments. A DeFi carpet pull is the most common exit-scam scam.

Limiting sales orders

This medicine is a subtle way for a lousy developer to scam investors. In this case, the developer codes the tokens so that they are the only party that can sell them. Developers then wait for personal investors to purchase their new crypto using paired currencies. Paired currencies are two currencies paired for trading, one against another. When there is enough positive price movement, they leave their position and leave behind a free token. The Squid Token scam is an example of such carpet pulling actions.

Dumping

Dumping happens when developers quickly sell their own large token offerings. Doing so lowers the price of the cryptocurrency. It allows the remaining investors to hold free tokens. “Dumping” often occurs after heavy publicity on social media platforms. The resulting spike and sale is known as the Pump-and-Dump Chart. Dumping is more of an ethical gray area than other DeFi carpet pulling scams. In general, it is not unethical for crypto developers to buy and sell their own currencies. When it comes to the DeFi withdrawal process, “dumping” is the question of how much and how fast a cryptocurrency is sold.

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