Suspected multi-million scam on Binance smart chain

Suspected multi-million scam on Binance Smart Chain

A DeFi project on the Binance Smart Chain (BSC) turns out to be a huge scam and loots 31 million US dollars.

According to consistent US media reports, the DeFi project „Meerkat“ has allegedly committed fraud worth millions of dollars on the Binance Smart Chain. This morning at 10:00 Central European Time, the company reported in its Telegram group that it had been the victim of a hack – one day after it had joined the BSC. As a result, 13.96 million BUSD and 73,653 BNB tokens disappeared from the platform. Together, this amounts to a total loss of US$31 million.

Now suspicions are being raised that Meerkat itself could be behind the attack. This was shown by on-chain data. According to this, the attackers used Meerkat’s own developer accounts to make changes to the smart contract. This accusation is strengthened by the fact that the DeFi project cut all connections to their BitQT social channels shortly after the tokens disappeared. For example, the Twitter account is offline and the website is for sale for US$10,000. The company seems to have lived up to its name and literally disappeared into the hole in the ground.

The defrauded users are naturally shocked. In the meantime, complaints are piling up on the Binance community page. There is also a thread on Reddit. There, the term „rug pull“ is mentioned again and again. This refers to a type of scam in the DeFi sector where the project leader promises high profits and great future prospects and then suddenly disappears. BTC-ECHO has asked Binance how the platform intends to prosecute the fraudsters and whether the crypto exchange will pay out compensation to its users. So far, the request has remained unanswered.

Increased accusations of plagiarism against Binance Smart Chain

In addition to the current scam, plagiarism allegations are increasingly doing the rounds on the DeFi platform. With its Smart Chain, Binance has entered into direct competition with Ethereum. Now, however, there are more and more accusations that the supposed competition is in many cases nothing more than a mere copy. This is what happened with the BSC-based platform Musical Beats, which was shut down just a few days after its launch.

The background: Ethereum developers and community members had accused the BSC project of copying EulerBeats and profiting from its success. EulerBeats transforms the works of Swiss mathematician Leonhard Euler into unique visual and acoustic works of art. Users can add these works to their collection and receive a percentage share from sales of prints of these works. Experts, such as ConsenSys legal expert Matt Corva, partially confirm the plagiarism allegations. Corva even speaks of a copy-and-paste procedure. This is all the more ironic, he says, because EulerBeats is precisely about participation in copyrights.

Irony currently seems to be an obedient companion of the BSC. Regardless of this, the platform needs to further develop its security structures in order to avoid scams in the future, if it wants to become a threat to the industry leader Ethereum.