Monday, July 22, 2024

DeFi Investors Duped Again – $6.4M Disappears in Latest Rug Pull

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Stanislav Shishkin
Stanislav Shishkinhttps://cryptoapa.com/
Stanislav is one of the lead copywriters on cryptoapa.com and discusses all recent events in the crypto market. This includes news updates, but also price analyzes and more. He developed his passion for cryptocurrency during the bull run in 2017. He has learned a lot since then. The combination of cryptocurrency and creative writing is perfect for Jeroen and an excellent way to share his knowledge with a wide audience. Stanislav at cryptoapa.com

The DeFi lending protocol Magnate Finance on the Base layer-2 network conducted a rug pull, stealing $6.4 million from users. This incident marks the third rug pull on Base in just one month since its mainnet launch.

In total, developers involved in all three Base rug pulls have stolen $16.7 million in user funds. On Friday, Peckshield confirmed Magnate Finance manipulated its price oracle to withdraw all platform assets.

The majority of funds were sent to other networks like Optimism and Arbitrum. However, $1.3 million in DAI and 295 ETH worth $486,000 remain on Base.

Hours before, user ZachXBT predicted a rug pull as the Magnate deployer address received funds from prior Base scams. Magnate has since deleted its online presence in a “classic rug pull.”

The early days of Base have seen multiple setbacks beyond rug pulls, including hacks of Rocketswap and LeetSwap. However, Base has shown resilience, ranking as the 4th most active layer-2 by transactions per second.

While overall DeFi TVL has dropped below $40 billion, Base TVL still grew 11% this week to $185 million. But the repeated rug pulls have hurt trust in the nascent network.

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