Blast: The New Platform for $1M Blockchain Fraud Schemes

A group known for their involvement in fraudulent activities in the blockchain space, particularly on platforms like Magnate, Kokomo, and Lendora, has now shifted their schemes to a new platform called Blast. They have managed to transfer approximately $1 million in illicit funds to finance their fraudulent endeavors. On-chain detective ZachXBT discovered that these funds were initially moved from an Ethereum address tied to previous scams to another address on the Polygon network. The assets were then converted into Wrapped ETH (wETH) and moved across multiple blockchain networks using bridging services like Orbiter and Bungee. Eventually, they were used on the Blast platform to purchase LEAP tokens, which seems to be part of their plan to deceive unsuspecting victims.

ZachXBT also suspects that the same group is likely behind a separate project called ZebraLending on the Base platform, which currently has a total value locked (TVL) of approximately $311K. This group has a history of launching various projects that attract significant TVL but ultimately absconding with the funds. Their tactics often involve creating false Know Your Customer (KYC) documents and collaborating with less reputable auditing firms to give the illusion of legitimacy. They have targeted multiple platforms, such as Base, Solana, Scroll, Optimism, Arbitrum, Ethereum, and Avalanche, demonstrating their adaptability and widespread presence within the blockchain community. This recurring pattern of fraud highlights the importance of remaining vigilant in the blockchain space.

Investors are advised to exercise caution, especially when dealing with new projects on platforms like Blast that involve large fund transfers. It is crucial to verify the qualifications of projects, examine audit experiences, and understand the channels through which funds are being transferred in order to protect investments. Community members are encouraged to share information and support each other in identifying suspicious activities to prevent further victimization.

Notably, a nonfungible token (NFT) game called Munchables, built on the Blast platform, fell victim to a $62 million exploit on March 26. The team behind Munchables acknowledged the breach and stated their efforts to track the exploiter’s movements and halt the transactions. After the launch of Blast’s mainnet on February 29, approximately $400 million in Ether (ETH) was withdrawn from the Ethereum layer-2 network, unlocking nearly $2.3 billion in staked crypto that was previously locked up. Blast had already reached a total value locked (TVL) of over $2.1 billion prior to the mainnet launch, scheduled for the end of this month.

2 thoughts on “Blast: The New Platform for $1M Blockchain Fraud Schemes

  1. I feel for those who have lost their investments in these fraudulent schemes. It’s a painful reminder that the blockchain space still has a long way to go in terms of ensuring the safety and security of investors.

  2. This is a wake-up call for the entire blockchain community. We need to educate ourselves and each other to prevent further victimization. Sharing information and staying vigilant is key.

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