Decentralized Exchange Swaprum Falls Victim to Exit Scam, Inflicting Substantial Losses on Users
Swaprum, a decentralized exchange (DEX) operating on the Ethereum layer-2 network Arbitrum, has experienced a devastating rugpull.
The project's developers siphoned off approximately $3 million worth of ether (ETH) tokens from Swaprum's liquidity pools, resulting in a significant decline of over 99% in the value of its native token.
This exit scam highlights the ongoing risks associated with investing in the decentralized finance (DeFi) sector.
Peckshield Revealed that around 1,628 ETH, equivalent to $3 million, was drained from Swaprum's liquidity pools.
The theft occurred late on Thursday and involved the removal of liquidity provided for the platform's native token, SAPR.
The stolen assets were sold for ETH and then funnelled through a cryptocurrency mixer, Tornado Cash, for obfuscation.
Beosin, a blockchain security platform, conducted a comprehensive analysis and discovered that the Swaprum smart contract had a backdoor function added by the deployer.
This function enabled the theft of liquidity pool tokens staked by users. By exploiting this backdoor, the deployer drained the pool and profited from the stolen assets.
The devastating impact on Swaprum's native token, SAPR, caused its value to plummet by 99%.
As of now, the token is trading at $0.000022, representing a significant decline from its previous price of $0.147.
The 24-hour trading volume stands at a mere $83, indicating a severe loss of confidence among investors.
In a suspicious move, Swaprum's social media accounts on Twitter, GitHub, and Telegram have been deleted, leaving only the platform's website active.
This sudden disappearance raises further concerns about the project's integrity and adds to the scepticism surrounding the rugpull.
The rugpull on Swaprum, resulting in the loss of $3 million in funds and a near-total collapse of the SAPR token's value, underscores the persisting vulnerabilities within the DeFi ecosystem.
Investors must exercise caution and conduct thorough due diligence before engaging with decentralized exchanges or investing in DeFi projects.
Such incidents highlight the importance of crypto regulatory oversight and security measures to protect users from potential scams and fraudulent activities in the rapidly evolving crypto landscape.