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The smart contract's deployer obtained ETH as a tax each time a user traded the OZK token.
Blockchain security firm CertiK has confirmed that OrdiZK, a self-described “ETH, BTC, and SOL” bridge, has conducted an exit scam on March 4 and 5, leaving investors grappling with the aftermath.
In total, wallets belonging to the OrdiZK team hold ~$1.4m ETH.
OrdiZK Deployer: $1,037,125.98
OrdiZK Treasury: $263,482.20
OrdiZK Marketing wallet: $173,899.48
— CertiK Alert (@CertiKAlert) March 5, 2024
According to a media note released by CertiK, the scam involved the illicit dumping of tokens and unauthorized withdrawals, culminating in the loss of 347 ETH and $173,899.48, a significant blow to the project’s stakeholders and the broader digital asset market. Based on current Ethereum prices, the total damage dealt by the OrdiZK exit scam stands at roughly $1.4 million.
In what appears to be a calculated move, OrdiZK’s operators liquidated their holdings in a manner that caused substantial market slippage, effectively erasing any remaining value of the OZK tokens. This was done through a specific condition in the OrdiZK smart contract, which allowed its deployer to obtain ETH “as a tax” each time a user traded the OZK token.
“On 4 March the project deployer sold 489m OZK tokens for $132k causing a 98% slippage on OZK token 0xB4Fc1Fc74EFFa5DC15A031eB8159302cFa4f1288. On 5th March, the deployer sold another ~$214k on another OZK contract causing a ~99% slippage,” states CertiK in their security note shared with Crypto Briefing.
This was compounded by the removal of their website and all associated social media accounts, leaving investors with no recourse or means of communication. The disappearance of these platforms implies that the project’s intentions were oriented as an exit scam, as CertiK confirms. The perpetrator’s wallet can be viewed here.
The fallout from the OrdiZK scam is a cautionary tale that shows the risks associated with investing in digital assets. Despite the allure of high returns, the absence of stringent regulatory frameworks makes the cryptocurrency market a fertile ground for fraudulent activities. To counter such instances of outright fraud, it is advisable to always look at a project’s fundamentals and do careful research about how it works and what impact it provides to the crypto ecosystem, if any.
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