Swaprum DEX was recently drained in a crypto rugpull worth $3 million, causing panic and concern among its users. A rugpull is a type of scam where a group of people artificially inflate the value of a cryptocurrency and then suddenly sell off their shares, leaving others with worthless tokens and an empty bank account.
According to reports, the Swaprum DEX scam was carried out by one or more insider(s) who had access to the platform’s code and were able to manipulate it to their advantage. The scam began with a sudden drop in the platform’s liquidity, causing panic among traders who rushed to sell their tokens. This, in turn, triggered a domino effect, as prices tumbled and more traders sold off their tokens.
In the end, the scammers behind the Swaprum DEX rugpull were able to siphon off $3 million worth of cryptocurrency, leaving behind a trail of disgruntled traders and an empty platform. The scam has highlighted the dangers of using decentralized exchanges (DEXs), which are often viewed as being safer than their centralized counterparts.
Decentralized exchanges, or DEXs, are a type of cryptocurrency exchange that allows users to trade digital assets without the need for a central authority. Instead, DEXs rely on smart contracts to facilitate trades, which are executed automatically and transparently. While DEXs are generally viewed as being more secure than centralized exchanges, they are not immune to scams and hacks.
The Swaprum DEX rugpull is just one example of the risks associated with DEXs. While DEXs are designed to be more secure than centralized exchanges, they are still vulnerable to insider attacks, hacks, and scams. In the case of the Swaprum DEX rugpull, the scammers were able to exploit a vulnerability in the platform’s code, allowing them to drain the liquidity pool and walk away with millions.
As cryptocurrency continues to gain popularity, the risks associated with DEXs will become more pronounced. While decentralized exchanges are an important part of the cryptocurrency ecosystem, they are not without their flaws. As such, it is important for traders and investors to exercise caution when using DEXs and to be aware of the risks associated with these platforms.
In conclusion, the Swaprum DEX rugpull is a sobering reminder of the risks associated with decentralized exchanges. While DEXs are generally viewed as being more secure than centralized exchanges, they are still vulnerable to a range of scams and attacks. As cryptocurrency continues to evolve, it is important for traders and investors to remain vigilant and to exercise caution when using DEXs. Only through continued oversight and regulation can the risks associated with decentralized exchanges be mitigated.
Swaprum, a decentralized exchange (DEX) recently launched on the Ethereum layer-2 network Arbitrum, has reportedly drained $3 million in ether (ETH) tokens from the protocol in an apparent rugpull, otherwise known as an exit scam. The exchange offered high farming rewards, low swapping fees, and potential earnings of up to 100% annual percentage yield (APY).
The incident was flagged by blockchain security firm Peckshield on Friday, revealing that approximately 1,628 ETH, worth roughly $3 million, was drained from Swaprum’s liquidity pools. Onchain data shows that the exit scam was executed in the late hours of Thursday.
The team first removed the liquidity provided for SAPR, the platform’s native token, on the exchange and sold the assets for ETH. The funds were subsequently transferred from Arbitrum to Ethereum and then moved to cryptocurrency mixer Tornado Cash.
A deeper analysis by blockchain security platform Beosin revealed that the deployer of the Swaprum smart contract added a backdoor function to enable the theft of liquidity pool tokens staked by users. The deployer used the add() function to drain the pool for their profit.
As a result of the rugpull, SAPR lost almost all of its value. At writing time, the token was trading at $0.000022 with a 24-hour trading volume of $83, signifying a 99% decline from its previous price of $0.147 before the rugpull, according to data from CoinMarketCap.
In addition, the social media accounts of Swaprum on Twitter, GitHub, and Telegram have been deleted. Only the platform’s website was active at press time.
Meanwhile, Swaprum’s rugpull is one of the largest exit scams on the Arbitrum network. The incident has overthrown that of DeFi protocol Hope Finance, which suffered a $2 million exploit in February after a Nigerian hacker allegedly deployed a fake router on the platform.
This incident highlights the risks associated with decentralized finance (DeFi) investing and the importance of thorough research of any investment before putting in funds. Rugpulls, exit scams, hacks, and other security vulnerabilities can cause significant losses to investors, which is why it is crucial to conduct due diligence on the protocols, teams, and technologies involved before investing in any project.
Decentralized exchanges have gained popularity in the past year due to their potential to offer increased security and privacy, as well as reduced fees compared to centralized exchanges. However, the increasing number of security incidents involving DeFi protocols highlights the need for stricter regulation and more sophisticated security measures in the space.
In conclusion, the Swaprum rugpull is a reminder of the high risks associated with investing in DeFi. Investors must exercise caution and perform thorough research before investing in any DeFi protocol or platform. This incident also underscores the importance of greater regulatory oversight and security measures in the space to prevent future rugpulls and loss of funds.
