A carpet pull is a type of scam where developers create and promote a fake project to disappear with investors’ funds. Here’s a roundup of 3 infamous rug draws that were clearly scams but managed to dupe investors out of millions of dollars.
For the unfamiliar, a rug draw is a type of scam where developers create and promote a bogus project to vanish with investors’ funds. Figuratively, they pull the rug out from under the feet of unsuspecting investors, hence their name.
Some rug prints use elaborate schemes, creating mock projects that seem plausible and worthy of investment. However, many rug draws clearly serve no purpose and usually piggyback on a trending event to attract investor interest.
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Surprisingly, several investors don’t see these projects for what they are – a blatant attempt to defraud investors of their funds – and pour money into these scam platforms. The result? Pain and suffering for investors, with entire savings lost in some cases.
Here’s a roundup of 3 infamous rug draws that were clearly scams but managed to dupe investors out of millions of dollars.
The Squid games token
This is one of the biggest crypto rug draws in recent history. In October 2021, a group of anonymous developers created a so-called paid token and promised coin holders access to an online game inspired by the popular South Korean TV show “Squid Games”.
With all the hype surrounding the show, investors ignored the warning signs and put their money behind the project. Thanks to this immense investor interest, the price of the Squid Games token saw a gain of 2,30,00,000% in one week and peaked at $2,862, according to data from CoinMarketCap.
Once the price reached that high, the scammers decided to sell their holdings, causing the price to drop. Squid Games went from an all-time high to $0 in minutes, leaving investors to hold the bag.
A crypto project named after a viral disease is not something most people would take seriously, let alone invest. However, not all investors see things the same way; where some see a recipe for disaster, others see something of a burgeoning investment opportunity. And that’s exactly what happened with MonkeyPoxInu.
The token was launched in May this year and was listed on PancakeSwap. Monkeypox had made a resurgence at the time and was all over the news. This gave the crypto project a wave to ride, with investors pouring money into the fake coin, hoping it would be lunar. However, MPOX lost 99% of its value three days later, leaving investors hanging in the balance.
CryptoWhale estimates that the miscreants behind the bogus project got away with $400 million in investor funds. However, crypto users believe this figure is too high for a token that has only been active for three days. In any case, many investors put money behind the project, which turned out to be just a hoax.
Queen Elizabeth Tokens
News of Queen Elizabeth’s passing has hit Britain hard and saddened many. However, that didn’t stop the opportunists from making the best of the situation. Just hours after his death, crypto scammers launched several meme pieces inspired by the late monarch. According to a Blockworks post, more than 40 projects bearing the Queen’s name were deployed on BNB Smart Chain and Ethereum 24 hours after Her Majesty’s passing.
One coin, Queen Elizabeth Inu, posted a 47,655% gain, accumulating $6 million in trading volume, according to Dex Screener. However, the piece simply rides on all the hype around the queen’s death and probably serves no purpose. Most other projects have little or no cash, a clear indicator of potential pump-and-dump carpet pull.
There have been no developments regarding these crashed projects yet. However, with many investors backing these seemingly worthless coins, disaster awaits.
The cryptoverse is growing at breakneck speed. It’s almost like there’s a new crypto project every other day. Many of these upcoming developments could be sweepstakes aimed at duping investors. Therefore, it is always important to do your research before investing in a coin.
Examine the problem(s) the project seeks to solve, the usefulness it offers, the fundamentals of the coin, the history of the developers, the clarity and quality of its white paper, KYC audits, etc. A thorough inspection of all these factors should give you a fair idea of the legitimacy of a project.
(Edited by : Priyanka Deshpande)
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3 Crypto Projects That Screamed Carpet Pull But Still Attracted Investors
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