Hello guys, welcome to the first episode of our Uniswap DeFi Rugs Chronicles. First of all, I believe you know what Uniswap and Rug are but if you do not have an idea you can read our article titled Rug the new crypto scam term inspired by Uniswap for more clarity.
Uniswap has been a stand out disruptive innovation in the Blockchain space but just as we stated in our previous article, Uniswap has inspired a couple of scamming techniques and avenues for scammers due to it being completely decentralized & open source.
This week started on a bright note for Uniswap traders and shill army but by evening of Monday 10th August, three DeFi based tokens trading on Uniswap had pulled the rug or exit-scammed as it is commonly known. These projects include Autem, Nexeum and Nugs. Although Nugs already sounds like a rug.
Insights on Autem Rug
I decided to use Autem as the case study here cos I invested in Autem and I can share first-hand information on how the rug was pulled.
- Liquidity locked both on Uniswap and Unicrypt
- Shilled by crypto influencers
- Telegram chat group with the developer
- Discord Channel
- Anonymous team
- Cheap logo
- Cheap website template
- Smart contract had a function to mint new tokens
How did Autem pull the Rug?
Autem passed one of the major preliminary checks for a legit DeFi project which is locked liquidity but unknown to investors the Autem smart contract had a mint function. What this means is the Autem token did not have a finite supply, as new tokens can be created which would automatically increase the total supply and can be poured into the market to inflate circulating supply.
What the Autem developer did was lock team tokens on Unicrypt which gave Autem a high credibility score over there. The developer went as far as speculating about a partnership with Unicrypt.
As a result of this speculated partnership, some well-known individuals within the Unicrypt ecosystem like UNC whale, Sparkcity, Karen and many more joined Autem telegram group and were actively shilling Autem on popular gem groups and Crypto Twitter.
UNC whale even went as far as claiming to have had a skype call with the anonymous Autem CEO and also hinted about a further partnership between Autem and another crypto project.
I do not know what is happening with $AUTEM to be clear. Sell if you are concerned. Always DYOR research and follow your gut. I only work direct with $UNC & $AGA & can vouch 100% 4 them. People in $Autem TG are trashing my name. If this was a scam, I was scammed just like you. https://t.co/iQTWx5LPYy
— UNC WHALE™️ (@uncwhale) August 10, 2020
All these speculations of partnerships and constant shilling on 4chan, twitter and telegram by influencers and telegram gem groups made investors comfortable and many were fomoing in.
This made the Autem token go from $0.08 to $1.55 within 48 hours. This is over x19, which made the Autem developer jealous and he had to call the mint function in order to join the moon boys and make bank lol…
Tokenomics of Autem
Initial Total Supply after private sale: 1,134,000
Circulating supply: 534,000
Locked tokens: 500,100
Hash of minted extra supply: https://etherscan.io/tx/0xdeb1c34bdc3fbff18706e7dc3a5215e4b718f833a86591e8ade0e30be6d79369
How many tokens did AUTEM developer mint?
The AUTEM developer minted an extra 1,000,000 AUTEM tokens. Increasing the total supply to above 2 million tokens and immediately this was done he deleted the Discord group of autem.network.
Hi @UNC_token $AUTEM was a complete scam yet your rating was 100. It would appear your rating system gives a 100 score just because there is locked liquidity; however, these scammers created a backdoor to mint new coins and then dumped the market and rugged a lot of people. pic.twitter.com/oRZbKXrrY2
— Crypto Bean (@iambean8) August 11, 2020
This 1 million minted tokens were then sent to Uniswap and was dumped in batches of 20,000 each time. Unfortunately for the scammer some eagle eyed investors spotted it and alerted the AUTEM community.
Although at this time those that bought at high levels were already in huge losses and there was literally nothing they could do to recoup their losses than moving on. I was lucky to had removed my initial capital and also made a few bucks but I still had about 30% of my bags trapped.
One dude even claimed to had lost about 15 Ethereum (~ $5700). We at Qrypto Central cannot ascertain what the scammer made away with but we estimate it was more than $15,000…
Rug pulls are just one bad side of buying tokens on Uniswap. Another downside of trading on uniswap.info are the exorbitant trading fees. The fees have gone as high as $10 for executing trades as at today 12th August.
Personally I am staying away from trading on Uniswap for now or buying any DeFi based token over there.
With the recent rug pulls we can see that locking liquidity is no longer enough judging by AUTEM, Nexeum and Nugs exit scams. Also having an anonymous team remains a big redline even as Crypto YouTuber and shiller Bitboy stressed recently in his video where he called out Vision Network and Blockclout for falsifying identities of their team.
Bitboy himself isn’t innocent as he also has a shady side. He has been spilling his latest calls to his close circle before making it public. So he literally buys low, spills it to his close circle they all buy. He then makes the call public and boom people start buying while he and his gang unload their bags lol…
Cryptocurrency trading is literally becoming the wild west where everyone just want to make bank.
In our next episode we will focus on the latest rug pulls on Uniswap. You can send in your criticisms, suggestions and contributions by commenting on this article below.