Pseudonymous blockchain investigator ZachXBT has issued a cautionary message regarding a group of scammers who are attempting to ensnare more victims in a new fraudulent scheme involving millions of stolen funds.
ZachXBT shared the results of an investigation on Leaper Finance, a lending protocol based on Blast, in a thread on X. The analysis revealed that the group is responsible for numerous rug pulls, including those that affected users of Magnate ($6.5 million), Kokomo ($4 million), Solfire ($4.8 million), and Lendora.
“In the past, they allowed the Total Value Locked (TVL) to reach seven figures before stealing all the funds deposited by users to the protocol and falsifying KYC documents, all while using low-tier audit firms. They have now launched scams on Base, Solana, Scroll, Optimism, Arbitrum, Ethereum, Avalanche, and more,” ZachXBT noted.
The group is also believed to be behind scams on Hash DAO, Glori Finance, and ZebraDAO, resulting in estimated losses of over $20 million.
A rug pull occurs when the developers of a blockchain-based protocol suddenly withdraw all the funds from a liquidity pool or project wallet, leaving investors with worthless tokens or assets. This is typically done without warning.
As part of their latest fraudulent endeavor, the group allegedly funneled nearly $1 million, which had been laundered from previous scams, into a Leaper Finance address on the Blast network. This injection of funds was intended to attract more victims.
Shortly after the connection between Leaper Finance and the scams was exposed, the group responded to ZachXBT by harassing the investigator and announcing a “token launch.”
“Well done! My comrades here at Lazarus fear you but also admire you!” they exclaimed, making a reference to the North Korean hacker group Lazarus. Subsequently, the accounts of Leaper Finance and Glori Finance on X were deactivated, and the websites of the two projects went offline.
According to a research report published by blockchain security firm Immunefi on February 29, a staggering $200 million worth of cryptocurrency was lost to hacks and rug pulls in the first two months of 2024, spanning 32 separate incidents.
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