The scammers were able to transfer depositors’ coins to themselves because they had complete control over the liquidity pools

Teddy Doge token developers stole $4,5 million from investors

26.07.2022 - 11:55

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2 min

What’s new? Investors in the Teddy Doge (TEDDY) meme token, created on the Binance Smart Chain (BNB) blockchain, fell victim to scammers and lost a total of $4,5 million. According to analytics company PeckShield, the developers of the project took advantage of the classic “rug pull” scheme. By controlling liquidity pools, they transferred 30 billion TEDDY owned by investors to their wallets and then sent the assets to the cryptocurrency exchange Binance.

Rug Pull is a type of scam in which developers abandon a project, fail to deliver on promises, and take investors’ money. After raising enough funds by PR of the roadmap that suggests sustainable development, the scammers delete the social media and leave the project without support, leaving investors with devalued tokens as a result.

How did events develop? After transferring investors’ assets to their addresses, the scammers exchanged fake tokens for wrapped Binance Coin (wBNB), converted them into 10 000 BNB and 2 million BUSD stablecoins, then sent the assets to Binance. According to aggregator CoinGecko, the price of the TEDDY token dropped by 100% in 24 hours after that.

PeckShield also discovered a connection between Teddy Doge and another meme coin, Half Pizza (PIZA), issued by Drac Network based on Ethereum. Thus, the developers of Teddy told Telegram that they are working on replacing investors’ assets with other tokens, DRAC, due to the rebranding.

Earlier, PeckShield warned of scams from DeFi projects Raccoon Network and Freedom Protocol, having recorded the transfer of 20 million BUSD from addresses associated with them to a third-party wallet. Freedom promised clients a yield of 183394,2% per annum, while Raccoon also promised interest to NFT holders acting as project governance tokens.

For more details on what fraudulent schemes are in the field of NFT and how to choose a reliable project, see GetBlock Magazine’s article.

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