Crypto Scammers Strike Again, Leaving Behind a Trail of Lost Funds

After blockchain investigator ZachXBT connected funds provided to three crypto projects (Leaper Finance, Zebra DAO, and Glori Finance) to illicit funds from previous hacks, the projects swiftly vanished from the internet. As the wallet used to fund the projects has been implicated in previous rug pulls and continues to fund dubious projects across multiple blockchains, investors are urged to exercise caution and conduct thorough research to avoid falling victim to similar scams.

Crypto Scammers Reappear with New Facade, Leave Behind Trail of Stolen Funds

A trio of crypto projects has vanished into thin air, their websites and social media accounts erased without a trace, leaving investors reeling from potential losses. The disappearance follows revelations by blockchain investigator ZachXBT, who uncovered a link between the projects' liquidity and funds pilfered in previous hacks.

On April 14, ZachXBT identified a wallet address serving as a conduit for stolen funds that were fueling liquidity for three fledgling crypto ventures: Leaper Finance on Blast, Zebra DAO on Base, and Glori Finance on Arbitrum. Each project boasted thousands of followers on social media, creating an illusion of legitimacy.

Further scrutiny revealed the wallet's nefarious history, tracing its involvement in a previous rug pull scheme and its current role as a source of liquidity for multiple projects across various blockchains, including Base, Solana, Scroll, Optimism, Arbitrum, Ethereum, and Avalanche.

As ZachXBT's exposé swept through the crypto community, the alleged scammers behind the projects swiftly dismantled their digital footprints. Project websites were taken down, and social media accounts were abruptly deleted. However, the scammer operating the Leaper Finance social media account briefly surfaced, acknowledging ZachXBT's detective work.

"Nice work! My comrades here at Lazarus fear you yet admire you!" the scammer remarked, cheekily proposing a partnership for a new scam token launch.

According to ZachXBT, the masterminds behind these projects are linked to the theft of millions of dollars worth of crypto from projects such as Magnate Finance, Kokomo Finance, Lendora, and Solfire. The pattern suggests a disturbing trend, with stolen funds being funneled into the creation of fraudulent crypto projects designed to lure unsuspecting investors into rug pull or exit scams.

Investors are strongly advised to exercise due diligence before committing funds to any crypto project. This includes thoroughly researching the founders and teams involved, verifying the legitimacy of audit reports, and carefully scrutinizing the project's whitepaper and roadmap.

The recent incident highlights the escalating threat of phishing scams on Base, an Ethereum layer-2 protocol. In March, Base experienced an alarming 18-fold surge in cryptocurrency funds stolen through phishing attacks compared to January, according to blockchain anti-scam platform Scam Sniffer. The platform estimates that phishing scams on Base alone netted approximately $3.35 million in March.

Scam Sniffer anticipates a further increase in phishing attacks on Base in April as the network gains popularity and attracts more active users. The rise in phishing scams coincides with the recent memecoin craze on Base, which has propelled the platform's total value locked to over $3.2 billion, representing a staggering 370% increase in 2024.

As the crypto market continues to evolve, investors must remain vigilant against the ever-present threat of scams. Thorough research, skepticism, and a discerning eye are essential tools for navigating the increasingly complex and volatile world of digital assets.