When the end of the year approaches, crypto predictions are in full swing. But not only ! It is also an opportunity for the various crypto companies to publish reports and studies. This is particularly the case, Solidus Labs. This risk monitoring company has published an annual report on the crypto market. The result: a high number of fraudulent cryptos. Since its creation, Solidus Labs has never recorded so many fraudulent tokens as this year. From January to November, over 118,000 fraudulent tokens were deployed.
The Carpet Pulling Scam: Commonplace in the Crypto World
It’s called a rug-pulling scam when the team or individual behind a crypto project suddenly abandons it. This in effect forces him to either sell all of his assets or choke out all of the cash in his project.
Because of such a practice, customers and investors end up with worthless crypto tokens. This inevitably leads to financial losses.
The exchanges most affected by the carpet pulling scam
the Solidus Labs report names BNB Chain as the crypto exchange company with the most fraudulent tokens. The Solidus Labs study suggests that 10% of all BEP-20 tokens are fraudulent. Ethereum is in second place with nearly 8% of ERC-20 tokens considered fraudulent.
Still according to the report published by Solidus Labs, there are also fraudulent tokens on centralized crypto exchange platforms. Malicious developers usually use it to collect funds and finance fraudulent projects.
As for the type of scam token, Honeypot is easily the most famous. It comes in the form of a smart contract that does not allow buyers to resell.
Each year, more than 2 million investors fall victim to carpet pulling scams. This is a serious issue that inhibits user trust in crypto. This is one of the reasons why the crypto market needs attention.a strict regulatory framework. Many procedures go in this direction. We therefore hope for an improvement in results in 2023.
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