MALICIOUS GROUP TARGETING LAYER-2 NETWORKS UNCOVERED 

Blockchain investigator ZachXBT has alerted the crypto community about a group of scammers utilizing stolen funds to support fraudulent projects on multiple blockchains.

ZachXBT’s recent investigation reveals that the perpetrators behind previous high-value rug pulls involving projects like Magnate, Kokomo, Lendora, and Solfire have launched a new fraudulent operation on Blast’s Leaper Finance.

Details of the Multi-Million Dollar Scam

ZachXBT shared details in a series of posts on X, noting that this group is notorious for letting the total value locked (TVL) in these projects reach millions of dollars before absconding with user funds. They are known to falsify KYC documents and employ lesser-known audit firms to seem legitimate.

The scammers have expanded their fraudulent activities across several blockchain networks, including Base, Solana, Scroll, Optimism, Arbitrum, Ethereum, and Avalanche. They are also linked to additional scams with Hash DAO, Glori Finance, and ZebraDAO, with combined losses surpassing $20 million.

ZachXBT warned about the immediate danger to users involved with ZebraDAO, advising them to withdraw their assets quickly to avoid losses.

The report highlighted that the scams, including the latest projects Glori Finance and ZebraDAO, were all derivatives of the Compound V2 protocol. It was found that major stakeholders of GLORI had financed these projects with funds sourced from previous fraudulent activities like Crolend, HashDAO, and HellHoundFi.

Recent Scam Developments

The scammers have recently initiated another scheme with Blast’s Leaper Finance, injecting almost $1 million obtained from past scams into the project to enhance its liquidity, aiming to attract new victims.

Following the revelation of Leaper Finance’s involvement in these scams, the group cheekily responded to ZachXBT, acknowledging his investigative efforts while referencing the infamous North Korean hacker group, Lazarus.

Subsequently, Leaper Finance and Glori Finance X have shut down their social media accounts, and their websites have been taken offline.

A February 29 report from Web3 security firm Immunefi disclosed that over $200 million in cryptocurrencies have been lost to hacks and rug pulls in the first two months of 2024 alone, marking a 15.4% increase from the $173 million stolen during the same period in 2023. This surge highlights the escalating threat of these cyber crimes within the crypto space.

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