Expert uncovers address that created 114 ‘fraudulent’ meme tokens

An unknown actor over the past 45 days created 114 “fraudulent” meme tokens and moved the funds raised from them to one address. This was noted by on-chain analyst ZachXBT.

Over the past 1.5 months one person has created 114 meme coin scams.

Each time stolen funds from the scam are sent to the exact same deposit address.

0x739c58807B99Cb274f6FD96B10194202b8EEfB47 pic.twitter.com/uwVAiG9WGG

— ZachXBT (@zachxbt) April 26, 2023

A portion of the assets was funnelled through Coinbase.

The analyst noted that none of the meme tokens are well-known coins. He did not rule out that there may be more such fake assets.

“I suspect there are others. These are only those sent to the [specific] deposit address,” he wrote.

In the thread’s comments, users noted that after each transaction the unknown actor deposits from Coinbase into his wallet 2.5-3 ETH to pay fees and maintain liquidity. Then he withdraws to his exchange wallet a profit of 0.1-0.2 ETH. Sometimes he even loses money on this.

seems like this person is only making 0.2 eth +- on each rug deployed. so lets call it 60 eth total made then. He even occasionally looses money from deployment costs. pic.twitter.com/Pq8ykAbzW9

— Umbrella (@umbrella_uni) April 26, 2023

According to ZachXBT, the exact amount earned cannot be calculated, as the user uses alternate wallets and fragments assets.

In a ForkLog comment, the analysts at HAPI Labs stated that this series of transactions, especially considering costs, cannot be attributed to the rug pull rug pull. They estimate that the user has earned less than $100 000.

“There is no precise legal definition of rug pull. But generally with such a scheme there is a team that states goals, promises that the token will have utility, floods it with substantial liquidity, lets users accumulate the coin, and then withdraws Ether or stablecoins from the pool, leaving users with nothing. Overall the scheme is similar, but here the individual does not make any promises and, for the most part, does not hide himself,” experts explained.

They are convinced that if needed, US law enforcement would have no trouble identifying the user via KYC on Coinbase.

“If Coinbase’s compliance team does not consider this money laundering, then there is little to fault. Moreover, none of our blockchain-analyst colleagues has yet defined his wallet as risky — rug pull wallets are marked as having the maximum level of risk,” added HAPI Labs.

Today, the whole episode, they say, appears to be a social experiment.

“The user issues meme coins hoping to create a new Shiba Inu or PEPE, but in reality such stories without marketing and investment don’t work. He preys on the greed of people who are willing to be deceived and buy any coin to make money.

If later he earns several hundred thousand or millions on one token and people quickly lose their funds, then one could call it fraud. For now, this is very small,” the analysts concluded.

In the original thread, ZachXBT’s followers also referenced a similar scheme found by user CoinGurruu. He found the address address, which over nearly two years conducted 2-5 rug pull attacks daily.

This wallet has launched 2-5 memecoin rugs daily for almost 2 years straight:

0xCc16D5E53C1890B2802d5441d23639CAc6cd646F

These devs have incredible hustle. Make sure you label it on Etherscan so you don’t line their pockets with your money

Absolute insanity. pic.twitter.com/ffNQ4sTGls

— ?Guru ? (@CoinGurruu) April 26, 2023

Today this address is marked as phishing on Etherscan.

Earlier ForkLog reported that the user dimethyltryptamine.eth earned more than $2 million in less than a week from operations with the meme token PEPE.