Arbitrum

Dollars

Million

Tornado Cash

<div class="textg"> Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our&nbsp;<a href="https://tokenist.com/terms-of-service/" class="deco-link" rel="noopener noreferrer nofollow">website policy</a>&nbsp;prior to making financial decisions.
</div><p class="has-drop-cap">Creators of the decentralized finance (DeFi) project Chibi Finance disappeared overnight after <a href="https://twitter.com/PeckShieldAlert/status/1673615238758006786?t=jURpLZ53pepUUXAvdsM-2g&amp;s=19" class="deco-link" rel="noopener noreferrer nofollow">reportedly stealing over $1 million</a> in user funds. The developers reportedly seized different crypto tokens from Chibi smart contracts and converted them to 555 ether (ETH).</p><h3 id="chibi-developers-disappear-with-555-ether">Chibi Developers Disappear with 555 Ether</h3><p>The developer team behind Chibi Finance, a DeFi project built on the Arbitrum blockchain, has reportedly vanished after stealing more than $1 million worth of several digital tokens in what appears to be another ‘rug pull’ in the decentralized finance space. The move comes just hours after Chibi launched.</p><p>The rug pull was made possible after Chibi developers deployed a malicious contract that enabled them to seize investor funds from the project’s smart contracts, <a href="https://twitter.com/CertiKAlert/status/1673639936631734272" class="deco-link" rel="noopener noreferrer nofollow">according to blockchain security firm CertiK</a>. This is the 12th exit scam that occurred on Arbitrum in 2023, CertiK added.</p><p>On-chain data showed that roughly 555 ether, or $1 million, was taken from Chibi’s liquidity pools. More specifically, developers stole various crypto tokens staked by users and converted them to ETH. Then, the assets were transferred from the Arbitrum chain to Ethereum and routed via Tornado Cash – a controversial crypto mixer commonly used by hackers.</p><p>The digital presence of Chibi’s team disappeared in a matter of hours, with its social media accounts and the official website no longer accessible. CHIBI’s token price plunged 98% following the incident.</p><div class="cta-referral"><img src="https://tokenist.com/wp-content/themes/thetokenist/assets/img/del/cta-referral-1.png" alt="" class="cta-referral__img"><div class="cta-referral__text"><p>Join our&nbsp;<a href="https://t.me/thetokenist" rel="noopener noreferrer nofollow">Telegram group</a>&nbsp;and never miss a breaking digital asset story.</p></div></div><h3 id="losses-from-rug-pulls-were-higher-than-those-related-to-defi-hacks-in-may">Losses From Rug Pulls Were Higher Than Those Related to DeFi Hacks in May</h3><p>‘<a href="https://tokenist.com/investors-lose-815k-after-nft-marketplace-and-developers-disappear/" class="deco-link" rel="noopener noreferrer nofollow">Rug pulls</a>‘ refer to deceptive practices in the crypto space where the creators of a project abruptly abandon it stealing funds, and leaving investors with worthless or significantly devalued tokens. It involves intentionally misleading investors by promoting false promises or misleading information about the project’s potential, only to exit the market once a substantial amount of funds have been collected.</p><p><a href="https://www.binance.com/en/feed/post/588344" class="deco-link" rel="noopener noreferrer nofollow">Recent reports showed</a> that losses stemming from crypto rug pull and exit scams have exceeded those that resulted from <a href="https://tokenist.com/fbi-rings-alarm-as-defi-hacks-dominate-crypto-crime-1-3b-stolen-in-q1-2022/" class="deco-link" rel="noopener noreferrer nofollow">DeFi hacks</a> in May. In particular, six rug pulls in May led to more than $45 million in combined losses, compared to $19.7 million stolen in DeFi hacks last month.</p><p>This represents a major trend shift, given that <a href="https://tokenist.com/a-record-3-7b-was-stolen-in-crypto-hacks-in-2022-defi-most-targeted/" class="deco-link" rel="noopener noreferrer nofollow">DeFi accounted for 80% of all crypto hacks in 2022</a>. To address rug pull risks, blockchain security firm Beosin said that crypto users must increase their anti-fraud awareness and carry out due diligence before investing in a project.</p><div class="cta-sub js__cta-sub"><div class="cta-sub__start"><div class="cta-sub__title"><strong>Finance is changing.</strong></div><div class="cta-sub__subtitle"> Learn how, with Five Minute Finance. </div><div class="cta-sub__excerpt"> A weekly newsletter that covers the big trends in FinTech and Decentralized Finance. </div> Try it out (for free) </div><div class="cta-sub__form"></div><div class="cta-sub__result"><div class="cta-sub__title"> Awesome </div><div class="cta-sub__caption"> You’ve subscribed. </div><div class="cta-sub__greeting"> You’re well on your way to being in the know. </div></div></div><p><strong><i>Do you </i></strong><strong><em>think </em></strong><em><strong>rug pulls will continue in the crypto space in the near future? Let us know in the comments below.</strong></em></p><p>The post <a href="https://tokenist.com/arbitrum-based-defi-project-chibi-finance-disappears-with-a-million-dollars/" rel="noopener noreferrer nofollow">Arbitrum-Based DeFi Project Chibi Finance Disappears With a Million Dollars</a> appeared first on <a href="https://tokenist.com" rel="noopener noreferrer nofollow">Tokenist</a>.</p>

Arbitrum-Based DeFi Project Chibi Finance Disappears With a Million Dollars

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