SatoshiCoreSwap, one of the decentralized exchanges (DEX) built on the Core Blockchain offers users a way to trade various cryptocurrencies without the need for a centralized intermediary. However, on Monday night 15 May 2023, the platform allegedly conducted a rugpull, worth 220 Eth causing users to lose their investment.
A rug pull is a fraudulent practice where the creators of a decentralized platform suddenly pull liquidity from the platform, causing the value of the tokens on the platform to plummet. In a rugpull, the creators of the platform typically sell their tokens at a high price, leaving investors with worthless tokens.
In the case of SatoshiCoreSwap, a transaction on the exchange remove all the staking funds in one fell swoop and bridged 220 ETH ($385,000) then transfers were executed using Tornado Cash, a privacy tool used for transaction obfuscation which is usually used by rugpulls to remain anonymous according to Documenting Core one of the Twitter handle, who promoted SatoshiCoreSwap.
1/ 🚨Official Post-Mortem of SatoshiCORESwap!🚨
— Documenting CORE 📄 (@DocumentingCore) May 16, 2023
It is with a heavy heart that we report #SatoshiCORESwap has officially announced a rug pull. In the late hours of yesterday, an estimated 220 ETH was rugged. pic.twitter.com/pm17LIKzV7
However, SatoshiCoreSwap in its response to the rug pull allegation stated the rumor is not true, and claims that they were facing some difficulties during the Dex upgrade to a multichain contract and it is now completed.
There are false rumors that we did a rugpull while it is not true.
— SatoshiCoreSwap (@SatoshiCoreSwap) May 15, 2023
We had some struggle on the upgrade and it is complete.
Please upgrade your existing staked tokens / LP tokens and you can stake / unstake as usualhttps://t.co/AfStQRFI4j
Thank you.
The incident served as a stark reminder of the risks associated with investing in decentralized platforms, particularly those that are relatively new and untested.
Investors in decentralized platforms should always exercise caution and conduct thorough due diligence before investing their funds. They should also be aware of the risks associated with investing in decentralized platforms, including the risk of rugpulls, scams, and other fraudulent activities.
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