DeFi protocol developers pull an exit scam; siphons off with $32M thumbnail

DeFi protocol developers pull an exit scam; siphons off with $32M

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DeFi Protocol Developers Pulls an Exit Scam; Siphons off With $32M

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DeFi has witnessed spectacular growth off late. While it does bring in limitless opportunities for the participants in the market, it also tags financial perils along with it.

in 2021 alone, exit scams in the decentralized finance space have increased at a worrisome pace. This time investors fell victim to DeFi100, a decentralized finance protocol built on the Binance Smart Chain. Reports alleged that the founders had run away with $32 million in investors’ funds.

The entities had posted a vicious message on the website which said: “We scammed you guys, and you can’t do shit about it”

DeFi100

DeFi100’s only clarification following the incident was a tweet in which it said their website was hacked yesterday and the message was written by the hackers. Shortly thereafter, the website showed an error 404 message.

Some speculated that several projects are bound to show their true colors as the bull season fades and hence it there could be a huge increase in exit scams over these next few months. One crypto analyst urged market players not to invest in projects that are very new, backed by anonymous teams, made as memes, and lack real utility.

Another twitter user and a community member who goes by the pseudonym ‘CryptoDragon‘ stated,

“After the dev scammed everyone and posted this picture on the site, some angry people found his internet footprints and exposed his real identity and location. The scammer has now been reported to Interpol and local authorities.”

Defi 100’s native token crashes

chart 2

After the developers absconded from the project, Defi 100’s native token, D100 took a plunge to its lowest value. According to CoinGecko’s latest chart, the defi coin was down by more than 25% which drove its price to $0.040, at the time of writing.

Meanwhile, crimes have become more pronounced in decentralized sector as they continued to boom while attracting bad actors. Along the same line, the crypto intelligence company CipherTrace had recently stated that while losses from cryptocurrency theft, hacks, and fraud declined sharply in the first four months of 2021, the same cannot be said about the defi ecosystem. The report stated that crime in the burgeoning “decentralized finance” space hit an all-time high.

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