Sudorare Shuts Down Operations Taking Away Over $800k of Customers’ Funds Despite Prior Warnings
- Prior to its closure, Sudorare offered a yield farm to users who staked LOOKs, XMON, and wETH for its tokens over one week.
- According to onchain data, Sudorare developers swapped over 1 million LOOKS for 154 ether and 60,000 USDC in one transaction.
- Six days ago, Twitter user @2shabby had cautioned SudoRare customers of using the protocol because its developers were unknown with unclear intentions.
SudoRare protocol, an automated-market maker (AMM) protocol for ERC-721 to ERC-20 swaps, has the rug pulled with 519 units of Ether worth approximately $815k. Meanwhile, the SudoRare social media platforms have all been closed without any explanation.
Although the SudoRare rug pull was not a major one compared to others in the past, it is a genuine reminder for investors to do proper research before entering the blockchain and cryptocurrency industry. Moreover, unsuspecting users were depositing their digital assets oblivious of the impending rug pull.
SudoRare and Issues Affecting NFT Market
Prior to its closure, Sudorare offered a yield farm to users who staked LOOKs, XMON, and wETH for its tokens over one week. According to onchain data, Sudorare developers swapped over 1 million LOOKS for 154 ether and 60,000 USDC in one transaction.
Six days ago, Twitter user @2shabby had cautioned SudoRare customers of using the protocol because its developers were unknown with unclear intentions. Reportedly, the protocol was preparing to airdrop rewards to its early adopters.
Another Twitter user @Brentsketit had cautioned SudoRare users of an imminent attack. According to @Brentskitit, he kept getting dm’s about sudorare but was quite sure it was a scam. Thereby issuing a warning that SudoRare will steal customers’ funds.
A report by cryptocurrency exchange Bitstamp reveals that low literacy level is the main hindrance on digital assets’ adoption. Moreover, more people are afraid of losing their funds while navigating the many chains purporting to be the best.
According to the report, investors who see cryptocurrency being trustworthy from the United Kingdom have decreased from 52% in 2021 to 42 percent this year. Although the decline is not that significant, the decline only worsens the case for new investors.
The Non-Fungible Tokens (NFT) market is arguably one of the most affected with wash trading. NFT Wash trading is where a trader creates an order buying their digital artwork to create fake volume, thus attracting potential investors.
However, with the introduction of the NFT floor price, the digital artwork industry is expected to drastically reduce scams over time. According to data provided by Binnace-backed Coinmarketcap, the NFT industry has a market capitalization of $2,182,063,159.90, down 22 percent in the past 24 hours. However, the NFT sales in the past 25 hours stands at $7,822,752.27, up 3.9 percent.
While investigation on the SudoRare incident continues, cryptocurrency investors are advised to do their research before making any investment.
Otherwise, market pundits have argued that projects that promise unrealistic returns and have shady operations from the beginning should be avoided at all cost. Furthermore, the cryptocurrency and blockchain is not an overnight get rich scheme.
Rebecca is a Senior Staff Writer at BitcoinWisdom, working hard to bring you the latest breaking news in the cryptocurrency market. In the words of Elon Musk “Buy stock in several companies that make products & services that *you* believe in. Only sell if you think their products & services are trending worse. Don’t panic when the market does. This will serve you well in the long-term.”
