More than 350 fraudulent cryptocurrency tokens were created per day this year, defrauding millions of investors, according to blockchain risk monitoring firm Solidus Labs.
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Solidus Labs Research: 350 New ‘Scam Tokens’ Created Daily in 2022
Cointelegraph | Jesse Coghlan | Dec 18, 2022
More than 350 fraudulent cryptocurrency tokens were created per day this year, defrauding millions of investors, according to blockchain risk monitoring firm Solidus Labs.
- From the start of the year to Dec. 1, 117,629 “scam tokens” were deployed, according to Solidus’ 2022 “Rug Pull Report.”
- That’s a 41% increase from the nearly 83,400 scam tokens that Solidus detected in 2021.
- The report claims that BNB Chain harbors the greatest number of scam tokens, with 12% of all BEP-20 tokens being fraudulent.
- The Ethereum network was second, with a purported 8% of ERC-20 tokens alleged to be scams.
See: Trust Fallacy: 75% of Payment Fraud in Crypto is Carried Out by KYC-verified Accounts
- The most popular type of scam token was a “honeypot," which is a token smart contract that doesn’t allow buyers to resell.
- The most prolific “honeypot” in 2022 was the $3.3 million Squid Game (SQUID) token scam which grew 45,000% in a few days before anonymous founders apparently ran off with investor funds
- Centralized exchanges (CEXs) are also affected by rug pulls, as many behind these malicious tokens use them to fund their fraudulent project and cash out the ill-gotten gains.
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