A BNB Chain rug pull scams users out of $2 million
Binance, the creator of BNB Chain, has faced backlash for its handling of a $2 million rug pull on decentralized exchange PopcornSwap. The scam, which has now grown to $11 million in value, left users devastated and looking to Binance for help.
User hopes for Binance intervention
Following the rug pull in January 2021, users turned to Binance with the hope that the exchange would be able to freeze the scammer's address and recover the stolen funds. However, Binance initially claimed that it could not freeze wallets outside of exchange addresses due to the decentralized nature of BNB Chain causing frustration among users.
An unexpected turn of events
An investigation has now revealed that Binance does have the ability to freeze private wallet addresses on BNB Chain with the consent of all validators. However, the freezing of the scammer's address did not occur until almost two years after the initial incident took place. During this time, the funds remained untouched by the scammer.
The PopcornSwap rug pull
In 2021, PopcornSwap became a popular decentralized exchange on BNB Chain, attracting users seeking high trading volumes. However, the exchange was hit by a rug pull that resulted in the loss of all deposited funds. PopcornSwap was a fork of Pancakeswap on Ethereum, and it included a function that allowed developers to drain assets held by the protocol.
Victims turn to Binance for help
After the rug pull, victims formed a Telegram group called PopcornRugPull, where they offered support and encouraged each other to report the fraud to Binance. Some users believed that Binance could freeze the scammer's address, while others remained skeptical.
Binance's response
Binance initially provided some hope to victims when a customer service agent stated in an email that the scammer's wallet had been frozen. However, by October 2022, the funds remained untouched, and attempts to receive further assistance from Binance proved futile. PopcornSwap victims were left feeling disappointed and bewildered by the exchange's response.
Despite the controversy surrounding Binance's decision to freeze the scammer's address, it does highlight the wider issue of security and fraud in the cryptocurrency space. As more people enter the market, it is crucial for exchanges and platforms to prioritize the protection of their users and provide clear protocols for dealing with incidents like rug pulls.
