rug pull

Hackers and cybercriminals appear relentless in attacking the DeFi space. Recently, perpetrators have shifted their focus to the non-fungible token (NFT) space. SudoRare is the latest cyber scam event that has left crypto users losing more than $800,000.

On August 23, the team behind SudoRare, an automated market maker (AMM) protocol, suddenly closed down all its services and social media accounts, disappearing with staggering 519 ETH worth $800,000.

Unfortunately, SudoRare conducted the pull and rug malicious act a few days after a crypto user issued a cautionary alarm that SoduRare might be a scam. Despite this early warning, developers behind the non-fungible token platform have rugged users more than $800,000 in various cryptocurrencies before deleting their online footprints.

What Is A Rug Pull Scam?

By description, rug pull is a form of scam that involves a developer attracting investors to a new cryptocurrency project, then pulling out before they finish the project, leaving investors with a worthless currency.

In decentralized finance (DeFi), rug pull scams happen when the developers conduct legitimate work on a blockchain and then drain the liquidity pools from the project, essentially “pulling the rug” from under investors and causing a sharp fall in related tokens. SudoRare is a perfect example that has recently practiced similar malpractice.

SudoRare Overview

SudoRare was a fork of the decentralized NFT marketplace SudoSwap. The automated market maker was renowned for its liquidity pools for NFTs and cheaper gas fees.
SudoRare featured LookRare (LOOKs), an NFT marketplace, rewarding users for their participation on the platform. SudoRare gained mainstream popularity last year during the crypto cycle hype.

In the past week, SudoRare offered a yield farm to the user who staked its native token LOOKs, XMON, and wrapped Ether (eETH). Six hours after it went live, SoduRare developers have emptied its liquidity pool, rugging more than 1 million LOOKs and 60,000 USDC in one transaction. Those notorious cybercriminals have managed to run away with over 519 ETH.

Based on Perkshield, a renowned blockchain investigator, who hinted at possible a small-scale rug pull scam, the alleged stolen fund was equally divided and transferred to three different accounts, each receiving 173 ETH.

In a related development, hackers exploited the vulnerability in one of the popular NFT projects, the Bored Ape Yacht Club social media, stealing more than 200ETH through a phishing attack.

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