Ana Grabundzija · 12 hours ago · 2 min read
Ethereum › DeFi
Two multi-million dollar Ethereum DeFi project forks just “rug pulled” their investors
While the average DeFi coin is down massively since the summer highs, there have been projects launching that have caught the attention of many crypto investors, resulting in millions of dollars worth of capital raised.
Two such coins are Keep3r Network’s KPR and KORE.
The former is a coin launched by the founder of Yearn.finance and YFI Andre Cronje. As reported by CryptoSlate, this new token is the currency of a blockchain-based job network. It rallied over 15,000 percent in the day after it launched to the public.
The latter, KORE, is a “money game” that surged 4,000 percent in the day after its launch. The coin traded at a $40 million market capitalization a day after it went live and then proceeded to move even higher.
Both coins have launched in the past five weeks and have seen tremendous success as aforementioned, even in the face of a weak Ethereum price and brutal DeFi correction. Unsurprisingly, they have been forked by opportunist Ethereum developers looking to make a profit in a mini bear market.
Unfortunately, many of these forks have turned out to be scams or at least money grabs with no legitimate product or innovation.
This much was made clear when two multi-million-dollar forks “rug pulled” investors in the past 24 hours.
Two massive DeFi rug pulls take place in 24 hours
As noted by the crypto analyst “Degenomics,” a fork for both Keep3r Network’s KPR and KORE have been rug pulled over the past 24 hours.
The former was called KPER, a shameless rip off of Cronje’s latest project. At its peak, the project had a market capitalization of approximately $5,000,000. The latter was KORE, which was a CORE fork that had a multi-million-dollar market capitalization.
Who falls for these things? pic.twitter.com/yhYnaQNoa1
— Degenomics (@degenomix) October 31, 2020
Both coins currently trade for practically zero after the developers minted an inane amount of tokens to drain liquidity from the pool.
This isn’t the first multi-million-dollar DeFi scam that has taken place recently. CoinBreeder/CBDAO, whose token BREE once had a $50 million market capitalization, was subject to an exploit by an admin that resulted in the project collapsing.
Sign of a market peak?
Su Zhu, CIO and CEO of Three Arrows Capital, explained in an early October podcast that the prevalence of forks and scams of prominent projects is a likely sign that a crypto sector has topped.
The prominent crypto investor recently noted, though, that he thinks it may be unwise to short the decentralized finance market here.
He wrote on Oct. 30 that he doesn’t think “DeFi shorts have good r/r at this point” against the U.S. dollar, adding that he thinks “top-tier” projects are reaching points where long-term investors will deploy fiat to accumulate investments for the long run.
Update at 11:37am GMT: A previous version of this article was using the ticker CORE, when the project that rug-pulled investor’s ticker is KORE.
Get an edge on the cryptoasset market
Access more crypto insights and context in every article as a paid member of CryptoSlate Edge.
Join now for $19/month Explore all benefits