For those active in the decentralized finance arena, hardly a day goes by without a report of one project or another “exit scamming” its investors. From rug-pulling to fake presales, DeFi experts and novice traders alike are bleeding valuable Ether (ETH) from these scams.
With DeFi creating a market segment where project initiation cost is near zero, rogue actors now have the perfect environment to continuously siphon funds from victims. Aided and abetted by a rabble of social media shills and the current climate of frenzied yield-chasing, these crypto con-artists are able to cart away huge sums of money that run into the hundreds of millions of dollars.
Instead of DeFi helping to democratize access to global finance, the emerging market niche is becoming overrun by scams. The sheer volume of swindles, rip-offs and other unsavory market practices seem to have also contributed to noticeable price-cooling in the sector, with investors growing wary of new projects.
Crime pays in