Single crypto wallet launches 114 suspect coins

Research suggests rug pulls accounted for 37% of all income from cryptocurrency scams in 2021, versus just 1% in 2020.

A single cryptocurrency wallet could be linked with more than a hundred possible scams, new analysis has revealed.

The account is said to have introduced 114 memecoins, in what appears to be a so-called ‘rug pull’ operation.

The wallet has launched numerous seemingly fake coins in the past 45 days, cautioned ZachXBT, a blockchain company investigating frauds in the sector, communicating via several tweets.

Memecoins are crypto tokens inspired by popular internet jokes or memes which usually have little utility as an investment method. And, while some may just a bit of fun for the investor, they generally hold little or no intrinsic value.

Rug pulls rising

A 2022 report from US blockchain analysis firm Chainalysis, revealed scams were the largest form of cryptocurrency-based crime by transaction volume, with more than $7.7bn worth of cryptocurrency taken from victims worldwide in 2021.

The report stated that: “Rug pulls emerged as the go-to scam of the decentralized finance ecosystem, accounting for 37% of all cryptocurrency scam revenue in 2021, versus just 1% in 2020”.

Rug pulls took in more than $2.8bn worth of cryptocurrency from victims in 2021, it said, defining them as cases in which developers build out what appear to be legitimate cryptocurrency projects before taking investors’ money and disappearing.

Possible identification?

ZachXBT had noted the interactions that the wallet (0x739c58807B99Cb274f6FD96B10194202b8EEfB47) had undertaken in the past few weeks, which began to raise concerns.

However, the online monitor was not able to pinpoint the total financial damages possibly suffered by consumers who bought into the tokens.

But, ZachXBT’s thread was then picked by others online, such as Twitter user Lucrafund, who then figured out that some of the memecoin funds were sent to a Coinbase address, which would make the alleged culprit identifiable.

Another user was triggered by the fact that Coinbase would allow this to happen, but ZachXBT explained that small transfers sent one at a time make it very hard for any exchange to detect seemingly nefarious transactions.

ZachXBT also questioned why the person or persons would try and use Coinbase in the first place, given it's a well-regulated company with a solid anti-money laundering compliance track record.

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Written by Barney

Co-founder

Barney is co-founder of CryptoGamblingNews.com. When not at work he can usually be found behind a Nikon. He's won numerous international competitions for his photography and volunteers as a content creator for aid organisations in Africa.