Cryptocurrency investors are being warned to stay vigilant as fake tokens by scammers continue to exploit the decentralized nature of digital assets. Recent incidents have revealed how fraudsters manipulated various tokens, leaving victims with substantial losses. In this report, we’ll detail three separate scams involving fake tokens and rug pulls, shedding light on the need for caution within the crypto space.
The Sleepless AI token scam
In a stark reminder of the risks associated with cryptocurrencies, scammers managed to steal $91,000 worth of Ethereum (ETH) by orchestrating a rug pull of the fake Sleepless AI token. This incident occurred just before the launch of the genuine Sleepless AI farming campaign on the Binance Launchpool.
The fake FomoFi token incident
A parallel rug pull scheme unfolded with the fake FomoFi token, demonstrating how fraudsters can manipulate the market to their advantage. The scammer exchanged over 5.3 trillion FOMO tokens for 189,600 BSC-USD, causing the token’s value to plummet to zero.
NebulaNode token devaluation
In yet another case, the NebulaNode token suffered a severe devaluation after a substantial amount of NNNN tokens were exchanged for 1033.8 BNB, equivalent to approximately $335,900. This incident underscores the need for heightened security measures within the cryptocurrency ecosystem.
Origins of Sleepless AI farming
The genuine Sleepless AI farming project was set to launch on December 28th, joining the ranks of Binance Launchpool projects. The initiative offers a web3 gaming platform that incorporates artificial intelligence (AI). Users have the opportunity to stake BNB, FDUSD, and TUSD in designated pools during a seven-day campaign.
Previous security incidents
Cryptocurrency security has been a recurring concern. Prior to these latest fake tokens scams, security experts at Certik had reported a rug pull involving fake Linea tokens in October, resulting in a staggering loss of approximately $743,000. Suspicions have arisen that a user named ‘AltLex’ may have promoted the fake token on social media, possibly having connections to Russia.
These incidents serve as a stark reminder for cryptocurrency investors to exercise extreme caution. With the decentralized and relatively unregulated nature of the crypto market, fraudulent activities can occur without adequate oversight. Investors should conduct thorough research before engaging in any token offerings or investments.
Protecting your investments from fake tokens
To safeguard their investments, cryptocurrency investors should consider the following precautions:
1. Due Diligence: Conduct comprehensive research on tokens and projects before investing.
2. Verified Information: Rely on reputable sources and verify information independently.
3. Secure Wallets: Use secure wallets to store digital assets and enable two-factor authentication (2FA) where possible.
4. Beware of Promotions: Be cautious of social media promotions and conduct thorough background checks on influencers and projects.
The recent scams involving fake tokens and rug pulls highlight the importance of vigilance and due diligence in the cryptocurrency space. Fraudsters continue to exploit the decentralized nature of the market, leaving investors vulnerable to substantial losses. By staying informed and adopting security measures, investors can reduce the risks associated with cryptocurrency investments.