An infamous group with a history of fraudulent activities in the blockchain space has recently launched a new scheme on Blast, as reported by ZachXBT, an on-chain investigator. The group has transferred around $1 million in illicit funds to Base to kickstart their latest scam.
The group, whose identity remains undisclosed, initially moved the funds from an Ethereum (ETH) address associated with previous scams, eventually routing them to another address on the Polygon network. The alleged scammers then converted the funds into wrapped Ether (wETH) and transferred them across various blockchain networks using bridging services like Orbiter and Bungee.
Their elaborate plan led them to the Blast network, where they reportedly funded an address that may belong to Leaper Finance, a decentralized lending protocol. ZachXBT describes these transactions as a sudden influx of liquidity aimed at luring unsuspecting individuals into their scheme.
Simultaneously, the blockchain detective, known for uncovering scams in the crypto world, highlighted that these individuals may also be behind another Base project called ZebraLending, which currently has a total value locked (TVL) of approximately $311,000. ZachXBT alleges that the group has a history of launching projects with significant TVL only to vanish with the funds later. The investigator also mentioned that the scammers often fake know-your-customer (KYC) documents and collaborate with questionable security auditing firms to appear legitimate.
The group has previously targeted platforms like Avalanche (AVAX), Ethereum, Arbitrum (ARB), and Solana (SOL), demonstrating their adaptability and widespread presence in the blockchain industry. According to ZachXBT, the scammers typically build up their projects to multi-million dollar values before executing a rug pull and absconding with investors’ funds. Previous projects linked to the group include Solfire Finance on Solana, Lendora Protocol on Scroll, and Magnate Finance on Base.
In the Magnate Finance case, the group reportedly stole over $6.5 million shortly after ZachXBT and other security experts raised concerns about the project. In the Solfire scam, they made away with approximately $3 million.
Blast, a layer-2 (L2) network launched by Blur founder Tieshun Roquerre, has recently been targeted by several scams, exploits, and rug pulls. Earlier this year, RiskOnBlast, a project on the platform, fell victim to a rug pull resulting in a loss of around 500 ETH. Super Sushi Samurai, a blockchain game native to the network, also suffered a token exploit just before its gaming launch, losing $4.6 million due to a smart contract bug.
Furthermore, Munchables, another NFT game on Blast, experienced a $62 million exploit in March. The team behind Munchables acknowledged the breach and initiated efforts to track the exploiter’s actions and prevent further transactions.
In the midst of these incidents, it’s crucial for investors and participants in the blockchain space to remain vigilant and conduct thorough due diligence before engaging with any projects or platforms.