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The cryptocurrency that collapsed by 98% due to fraud of its founders is named
Kokomo Finance’s decentralized lending protocol has caused $ 4 million in losses to customers. The reason is the 98% collapse of the KOKO token rate. This was reported by CertiK researchers on Twitter.
On March 26, 2023, Kokomo Finance conducted an exit scam and stole ~$ 4 million in user funds.
Details Below? https://t.co/BEPwfahblz
— CertiK Alert (@CertiKAlert) March 26, 2023
According to CertiK, Kokomo developers made changes to the smart contract to block users from paying rewards and borrowing cryptocurrency. The fraudsters then stole $ 4 million by converting investors' money.
Analysts noted that the firm deleted all social media accounts immediately after the announcement of the alleged fraud.
Kokomo Finance is a fork of the Compound protocol, which was launched in mid-March for decentralized lending based on the Optimism and Arbitrum sidechains. With the help of the service, users could take loans and earn money in wrapped Bitcoin (wBTC), Ether (ETH), Tether (USDT), USD coin (USDC), and Dai (DAI) tokens.
According to CoinGecko, the KOKO token rate fell by 98% to $ 0.66 108 amid the news. According to CertiK, this is the largest attack recorded in the Optimism sidechain ecosystem.
Earlier, another decentralized lending protocol, Euler Finance, suffered from a hacker attack. The project lost more than $ 190 million in cryptocurrency. However, the hacker later returned more than 51,000 ETH to Euler. The attacker also made several more transactions and transferred more than $ 10 million in DAI stablecoin to an unknown address. A few days before, the cyber fraudster contacted the project team. He stated that he did not intend to keep what did not belong to him and was ready to negotiate.