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Crypto developer commits $2M rug pull fraud to fuel gambling addiction

The Cointelegraph ​

Cryptocoins News / The Cointelegraph ​ 95 Views

A Redditor described the developer’s gambling addiction excuse as a “weird way to rug,” as projects usually just run away and delete all the evidence.

According to a Reddit post, a developer has posted an unusual farewell note, apologizing and blaming his online gambling woes after leaving a project in shambles, turning a $2 million valuation into $20,000 within minutes.

Several investors in the Encryption AI project have reported that its developer performed a rug pull during a liquidity migration event. As a result, the project’s token, 0XENCRYPT, went from trading at around $2.05 to an all-time low of $0.02. Token data aggregator CoinGecko recorded the massive price drop around July 2.

Seven-day price chart for Encryption AI’s token. Source: CoinGecko

Unlike other rug pulls, the developer decided to leave a letter to the project’s community, apologizing for his actions, and blaming his gambling addiction for the move before disappearing and deleting all the project’s social media platforms.

Various investors shared a screenshot of the developer’s message on social media. Within the post, the developer shared his struggles with gambling and highlighted that he lost $300,000 in online casinos. In addition, though the developer was unable to guarantee that he would make amends or relaunch the project, he promised to “make every effort to become a better person.”

Related: How to spot a rug pull in DeFi: 6 tips from Cointelegraph

Community members were outraged by the rug pull, with some wishing karma upon the developer and others describing the move as the worst birthday present, and a weird ending to a rug pull.

Trader Crypto Daddi lamented that the rug pull happened on his birthday. The Twitter user claimed he lost around $30,000 after trusting the developers and investing in the project. On Reddit, a community member described the developer’s action of leaving a long note as a “weird way to rug,” as developers often just disappear without a trace after performing such actions. 

Meanwhile, Binance’s chief security officer Jimmy Su recently spoke with Cointelegraph about how bad actors on the darknet are working to steal from crypto users. According to Su, hackers have a well-established ecosystem of intelligence gatherers, data refiners, hackers and money launderers.

Magazine: Should crypto projects ever negotiate with hackers? Probably


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