Check Point’s Threat Intel Blockchain system has revealed a new scam, shedding light on the persistent threat of Rug Pulls – a deceptive tactic causing financial losses for investors. 

The company’s system recently identified suspicious activities linked to a specific wallet address, exposing a sophisticated scheme that managed to pilfer almost $1m.

Operated by the address 0x6b140e79db4d9bbd80e5b688f42d1fcf8ef9779, the scam involved creating tokens associated with trending topics to attract unsuspecting buyers.

Described in an advisory published on Tuesday, the scheme unfolded with the creation of the mentioned counterfeit tokens, including GROK 2.0, followed by the injection of funds into the token pool to create an illusion of legitimacy. 

Simulated trading activities, orchestrated by the scammer, gave the appearance of market activity, further amplified by trades between the WETH cryptocurrency and the GROK token. The inflated demand successfully drew in investors, and when a critical mass was reached, the scammer swiftly withdrew liquidity from the token pool, leaving investors suffering significant losses.

Read more on Rug Pull schemes: Crypto Firm Pulls the Rug from Under Investors with $10m Scam

Behind the scenes, the scheme involved two distinct smart contracts, each playing a crucial role in trading and artificially boosting the token’s volume. 

A total of 226 trades were executed using the function 0x521da65d. At the same time, the contract at the address 0x4b2a0290e41623fbfeb5f6a0ea52dc261b65e29b facilitated the function 0xf029e7cf, increasing the token’s volume through strategic swaps between WETH and GROK tokens.

Check Point said this incident highlights the inherent risks in the cryptocurrency market, underscoring the importance of constant vigilance and due diligence.

“As the crypto landscape continues to evolve, staying vigilant and informed is paramount for investors,” the company wrote.

“The recent Rug Pull incident serves as a stark reminder of the need for heightened awareness and due diligence. By understanding the tactics employed by scammers, we can collectively work towards creating a safer and more secure crypto environment.”