Another reason why decentralized exchanges are a protective mechanism against potential fraud. In a shocking turn of events, it seems as though the decentralized finance “DeFi” micro-crypto project RichQuack has become the victim of an unprecedented rugpull masterminded by the now-defunct cryptocurrency exchange, Hotbit. Hotbit allegedly sold a staggering 256 trillion $QUACK tokens, worth approximately $153,800, belonging to $QUACK holders on the PancakeSwap platform. This malicious act has not only resulted in significant losses for RichQuack, wiping out approximately $100,000 in $USDT and $QUACK from their Hotbit balance, but it has also left their withdrawal requests unanswered. The impact of this distressing incident has reverberated throughout the crypto space, affecting other projects like BabyDogeCoin and DogelonMars.
Onchain data analysis reveals that Hotbit is engaging in dumping activities across various projects. The exchange has already dumped 4,000 BNB worth of BabyDogeCoin on PancakeSwap and $500,000 worth of Dogelon on Uniswap. The full extent of the repercussions on other projects and investors is yet to be fully determined, but it is evident that Hotbit’s actions have had far-reaching consequences in the micro-crypto space.
Hotbit had previously announced the cessation of all centralized exchange (CEX) operations in May, urging users to withdraw their assets before June 21. However, this recent rugpull has raised questions about the exchange’s intentions and practices, leaving many to question its credibility and the safety of funds held on the platform.
The RichQuack community, despite facing this devastating setback, has exhibited resilience and determination. Members of the community are expressing their commitment to overcoming this challenge, urging fellow community members to stay united and optimistic during these trying times.
We are touching on this because it should be a wakeup call for any cryptocurrency investor to consider decentralized exchanges and make sure that they are using a reputable centralized exchange that may carry the tokens they are interested in. Reputable exchanges, decentralized or centralized, should have protocols in place to screen listings on their platforms to prevent fraud. Micro-crypto tokens should be vetted to promote transparency and increase investor confidence.
It is advised that cryptocurrency investors should do their own due diligence and make sure that the projects they are getting involved in are genuine.