More than 350 fraudulent cryptocurrency tokens were created per day this year, defrauding millions of investors, according to blockchain risk monitoring firm Solidus Labs.
From the start of the year to Dec. 1, 117,629 “scam tokens” were deployed according to Solidus’ 2022 “Rug Pull Report.” That’s a 41% increase from the nearly 83,400 scam tokens Solidus detected in 2021.
It marks the largest year on record for fraudulent tokens since the firm began monitoring in Sep. 2020.
The report cited the BNB Chain as harboring the greatest number of scam tokens, claiming 12% of all BEP-20 tokens are scams.
The Ethereum network was second with a purported 8% of ERC-20 tokens alleged to be fraudulent.
A rug pull is a type of crypto exit scam where an individual or team creates a token and pumps up its price before extracting all the value from the project, abandoning it as the token price plummets to zero.
Almost 2 million investors have lost money to these scams since Sep. 2020, a greater amount than the estimated 1.8 million combined creditors affected by the bankruptcies of crypto exchanges and lending platforms FTX, Celsius, and Voyager.
The most popular type of scam token was a “honeypot”, which is a token smart contract that doesn’t allow buyers to…
