Robinhood Chain 'noisy' over unprecedented rug pull incident... "18.4 million dollars scammed with meme coins"

▲ Robinhood (HOOD), Decentralized Exchange (DEX), Cryptocurrency Trading, Artificial Intelligence (AI)/AI Generated Image

Evidence of a large-scale rug pull has been detected on Robinhood Chain, the proprietary blockchain network of the US online brokerage Robinhood Markets (HOOD). It has been revealed that the same fraudulent organization consecutively issued 53 meme coins, siphoning off at least 18.43 million dollars, bringing the security vulnerabilities of the nascent blockchain ecosystem into question.

According to the crypto-asset specialized media CryptoPotato on September 28 (local time), on-chain analyst Wazz revealed that 53 tokens issued on the Robinhood Chain over approximately two months, from July 10 to September 21, were used for organized fund siphoning by a single entity. The damage amounted to at least 18.43 million dollars, and considering the limitations of on-chain tracking, the actual scale of the damage is estimated to be significantly higher.

The fraudsters cleverly exploited the security mechanisms of Pons V2, the core launchpad of the Robinhood Chain. Pons V2 has a defense system that imposes a fee of up to 99% on buy transactions immediately after token launch to prevent bots from front-running the initial supply. However, the fraudsters utilized a fee exemption system to sweep 82% to 86% of each token's supply into 70 to 200 pre-designated wallets, then offloaded the tokens at inflated prices to general investors.

Analyst Wazz identified that the 53 tokens were the work of a single organization through three on-chain tracking techniques. 45 tokens were linked by direct fund transfers between wallets, with profits recovered from earlier tokens being reinvested as seed money for subsequent token issuances. Of the remaining 8 tokens, 4 shared the same transaction signing private key, and the other 4 used a common collection wallet to gather funds from multiple tokens. The stolen amounts per token were 3.12 million dollars for CRUMBS, 2.90 million dollars for LEGS, and 1.44 million dollars for PINK.

The sophistication of the method was also confirmed. The fraudulent organization launched multiple decoy tokens within 24 hours before the main token issuance to confuse investors, then disguised the final token as a legitimate project. In this process, initial buy transactions for 25 tokens were processed in bulk through a specific unverified smart contract. Most of the stolen funds are held in Ethereum (ETH), which is difficult to freeze, making actual recovery of damages unclear. Meanwhile, this investigation found no evidence that Robinhood or Pons were directly involved in the design and execution of the fraud.

Hidden security flaws behind the rapid growth of nascent Layer 2 networks have come to light, raising market vigilance. The market's attention is now focused on whether Robinhood Chain can strengthen its on-chain monitoring and restore investor confidence in the wake of the 18.43 million dollar serial rug pull incident.

[Article Key Summary]

-At least 18.43 million dollars were siphoned off through an organized rug pull exploiting 53 tokens on Robinhood Chain.

-The fraudsters exploited the launchpad's fee exemption system to front-run up to 86% of the token supply.

-Most of the stolen funds are held in Ethereum (ETH), making freezing and asset recovery unclear.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*