DappRadar: Web3 Ecosystem Loses ~$6 Billion to Rug Pulls Since January

From January to April, participants in the crypto industry lost approximately $6 billion due to rug pulls, with 92% attributed to the token of the RWA project Mantra (OM). This data is contained in a report by DappRadar.

During this period, seven incidents were recorded, which is three times fewer than the same timeframe the previous year. However, the damage in absolute terms then amounted to only $90 million.

“Fraud is becoming increasingly sophisticated, often organized by teams with polished branding and well-planned narratives,” the review states.

Most rug pulls are associated with meme coins, whereas the previous year, perpetrators divided their attention between “funny coins,” DeFi, and NFT tokens.

One such example was the 94% dump of LIBRA, associated with Argentine President Javier Milei, after the project’s capitalization peaked at $4.56 billion.

“Despite increased awareness and the emergence of tools to detect suspicious behavior, rug pulls remain a constant threat,” analysts noted.

Sudden spikes in UAW without apparent reason or unusually high volume combined with low user activity can serve as “red flags” for an impending incident.

Additional warning signs include projects with unverified smart contracts, limited updates on GitHub, anonymous developer teams, or dapps that skyrocket overnight.

“While rug pulls may never be completely eradicated, their impact can be significantly reduced if users are equipped with the necessary information,” the experts concluded.

Earlier in April, the prices of about a dozen low-liquidity coins plummeted. The dump was linked to the activity of market maker Wintermute.