7 months ago
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A group known for its past blockchain fraud activities has reportedly launched a fresh scheme on Blast.
According to ZachXBT, an on-chain detective, the group has moved approximately $1 million in laundered funds to Base to fuel its new scam.
Community Alert: The group of scammers who stole 8 figs with Magnate, Kokomo, Lendora, Solfire, etc is back with a new project on Blast @Leaperfinance
Last week they funded an address on Blast with ~$1M of laundered funds from the previous rugs and have begun adding liquidity… pic.twitter.com/yqRKvZuuye
The unnamed group initially transferred the funds from an Ethereum (ETH) address linked to previous scams, from which they eventually found their way to another address on the Polygon network.
The alleged scammers then converted the assets into wrapped Ether (wETH) and moved them through multiple blockchain networks using bridging services such as Orbiter and Bungee.
Their strategy led them to the Blast network, where they allegedly funded an address possibly belonging to Leaper Finance, a decentralized over-collateralized lending protocol.
ZachXBT characterizes these transfers as a sudden surge in liquidity aimed at enticing unsuspecting individuals.
Concurrently, the blockchain investigator known for uncovering various scams in the crypto world pointed out that these same individuals are likely behind another Base project named ZebraLending, with a current total value locked (TVL) of about $311,000.
Update: Same scammers are also likely behind @ZebraLending on Base which is currently live with $311K TVL
Withdraw your assets immediately if you have funds deposited in this protocol.
Tracing:
1) 0x085 transfers 30 wETH to 0x9f8 on Base… pic.twitter.com/Hv0v70azA7
ZachXBT claims the group has a track record of launching projects that attract substantial TVL only to disappear with the funds later. According to the investigator, the scammers often forge know-your-customer (KYC) documents and collaborate with dubious security auditing firms to appear legitimate.
History of scamming
The group has targeted other platforms, including Avalanche (AVAX), Ethereum, Arbitrum (ARB), and Solana (SOL), showcasing their adaptability and widespread presence in blockchain.
According to ZachXBT, the scammers usually grow their honeypot projects to seven-figure values before executing a rug pull and making off with investors’ funds. The blockchain sleuth pointed to past projects, including Solfire Finance on Solana, Lendora Protocol on Scroll, and Magnate Finance on Base, as past handiworks of the group.
In the Magnate Finance incident, the group reportedly stole more than $6.5 million hours after ZachXBT, alongside other security experts, raised alarm over the project. In the Solfire scam, they made off with approximately $3 million.
Blast, a layer-2 (L2) network introduced by Blur founder Tieshun Roquerre, has recently been hit by several scams, exploits, and rug pulls. In February, a project on the platform, RiskOnBlast, suffered a rug pull, resulting in a loss of around 500 ETH.
In March, Super Sushi Samurai, a blockchain game native to the network, suffered a token exploit just before its gaming launch. The team confirmed an exploit of $4.6 million due to a smart contract bug, verified by on-chain security firm CertiK.
According to the Super Sushi team, the exploiter manipulated the game’s smart contract to double token balances and mass-sell into its liquidity pool.
In the same month, another Blast-based non-fungible token (NFT) game, Munchables, suffered a $62 million exploit. Munchables acknowledged the breach and stated efforts to track the exploiter’s actions and halt the transactions.
