A decentralized finance (DeFi) project called Magnate Finance has committed a massive scam, stealing over $6.5 million from innocent investors.
DeFi Project Investors Lost Millions of Dollars
The project, which claims to provide high returns from liquidity mining, was deciphered on Twitter by cryptocurrency detective ZachXBT.
Before the incident, ZachXBT warned that Magnate Finance might be involved in a scam soon, and stated that the distributor's address is directly linked to another scam project called Solfire, which stole $4.8 million from users.
It also revealed on-chain ties with another exit scam called Kokomo Finance.
Shortly after ZachXBT's tweet, Magnate Finance's website went offline and the developers mocked him by commenting under ZachXBT's post. Then this account belonging to the fraudulent project was also closed.
The value of the project's native token MAG has dropped by 90%. According to blockchain security firm Peckshield, the scammer behind Magnate Finance manipulated the price Oracle of the project and removed all assets from the liquidity pools.
Peckshield also tracked the movement of stolen funds and found that the scammer transferred approximately $1.34 million worth of DAI to a new address and bridged approximately $1 million of the funds to the Binance Smart Chain.
*Not investment advice.