Kokomo Finance founders accused of an exit scam of $4 million

The protocol’s team made changes to the smart contract and withdrew user funds, CertiK reported

27.03.2023 - 14:30

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What’s new? On March 26, the team of the Kokomo Finance DeFi project conducted an exit scam and stole about $4 million in user funds. The value of the native token KOKO collapsed to almost zero, in addition, all of the project’s social media accounts were deleted. CertiK, a cybersecurity company, reported on Twitter.

#CertiKSkynetAlert 🚨On 26 March 2023, Kokomo Finance conducted an exit scam and stole ~$4 million in user funds.Details Below 👇 https://t.co/BEPwfahblz — CertiK Alert (@CertiKAlert) March 26, 2023

What else is known? Kokomo Finance is a non-custodial lending protocol based on the Optimism network. It was launched on March 23 and offered users 14-day genesis mining with a high annual rate. As a result of the exit scam, the KOKO rate fell by 98,5% to 0,00065904. As of March 27, at 13:45 UTC, the total value locked (TVL) on the platform is $1,96 million (Defillama’s data).

According to CertiK, the Kokomo Finance team made the exit scam by making a change to the smart contract. The developers closed the function of paying rewards and providing loans, and then they approved spending about $4 million worth of assets. Experts at CertiK noted in a comment to Cointelegraph that the incident was the largest reported by the company on the Optimism network.

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In December, the developers of the Clifford Inu project also withdrew investors’ funds, causing the native token CLIFF to plummet to nearly zero. In August, the token of the Dragoma blockchain game collapsed by 99% due to asset theft, and the creators of SudoRare withdrew $845 000 in cryptocurrency from the protocol. In July, the creators of the Teddy Doge token implemented the Rug Pull scheme, stealing $4,5 million from investors.

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