The Base network protocol ETHTrustFund (ETF), which advertised itself as akin to Olympus and Wonderland, carried out a sizable capital transfer on July 20.
The project, which was well-known for its debase and rebase features, allegedly transferred $2 million from its coffers to the Railgun and Tornado Cash mixer applications. There is a lot of conjecture that ETHTrustFund planned a “rug pull” or exit fraud as a result of this move and the abrupt removal of all of its websites and social media profiles.
On July 21, cryptocurrency investor and X user Octoshi first reported the problem. The project’s cash had been transmitted to a new address the day before, according to Octoshi.
PeckShield, a blockchain security platform, released the research on July 22. The developers of ETHTrustFund allegedly moved the money to mixer applications Tornado Cash and Railgun in an apparent attempt to launder it, according to the blockchain security company.
An archival copy of the ETHTrustFund development papers states that the project was originally intended to be a rebasing-capable decentralized autonomous organization (DAO), akin to Wonderland, Olympus, or other projects of a similar kind.
The firm provided bonds built on blockchain technology to investors in return for cryptocurrencies. Additionally, it “rebased,” or gave users who invested their tokens in the fund’s smart contracts, additional ETF tokens.
ETHTrustFund introduced a twist on the rebaseDAO concept by planning to slow token inflation over time and then “debase” (destroy) ETF tokens to increase the value of remaining tokens. The fund also aimed to use invested assets to generate yield for tokenholders.
However, there doesn’t seem to have been a debasing era. As to Octoshi, ETHTrustFund chief developer Peng eventually rugged the project on July 20 after he stopped answering Telegram conversations in April.
Rug pulls remain a major issue for crypto investors. In June, Gemholic was accused of a $3.5 million exit scam, while in March, the Ordiz bridge lost $1.4 million when its admins deleted their socials and transferred funds to new accounts.
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