Recent DeFi Security Incidents Confirm Rug Pulls Remain A Huge Problem

CryptoMode Scam Alert DeFi Rug Pull

It is no secret that decentralized finance is an industry with many opportunities. Unfortunately, it is also riddled with scams and exploits, with little improvement in sight. Below are five recent DeFi exploits, rug pulls, and other issues warranting demand for regulatory supervision. 

LlamaCoin (BSC)

The creator of LlamaCoin decided to rug pull all the liquidity on PancakeSwap a few days ago. It is not uncommon for such currencies to go through this process, and rug pulls remain very common. The culprit removed over $150,000 in liquidity and laundered all BNB proceeds through the TornadoCache platform. It seems unlikely anyone will see their money back. 

FlokiMoon (BSC)

Rug pull season is in full effect, and culprits seem to target the BNB Chain ecosystem these days purposefully. There are many similarities between FlokiMoon and LlamaCoin, as both were rug pulls with funds laundered through TornadoCache. Their stolen value is similar, as over $148,00 was taken during the FlokiMoon rug pull. A sad state of affairs when issues like these remain ever prevalent. 

StarFinancial (AVAX)

It is unfortunate to see a DeFi protocol on Avalanche suffer from an exit scam, although it can happen on any blockchain or network. The team running StarFinancial decided to swap the smart contract to one which contains hard rug code. Although the project had a public team, such nefarious actions have yielded over $40,000 in profit. It will be interesting to see if team member profiles turn out to be fake, though.

Mirror Protocol (Terra)

Things have gone from bad to worse for Mirror Protocol on the Terra blockchain. Following the demise of the Terra ecosystem and the clusterfuck with forking the chain, Mirror Protocol suffered from a $2 million DeFi exploit. An investigation is underway to figure out what happened precisely and how it took place, yet the funds are gone.  

Novo (BSC)

It has not been a good week for the BNB Chain and its DeFi protocols. Novo has been exploited through a flash loan attack, resulting in the loss of roughly $85,000. Similar to the other attack against BNB Chain-based protocols, the culprit laundered the money through TornadoCache. For now, there is no way of recovering the money, although things may always change in the future. 

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