ETHTrustFund rug pulls on Base, leading to $2m in investor losses

Developers have canceled the ETHTrustFund project on the Base network, causing investors to lose $2 million worth of Ethereum.

The fake project suddenly moved these funds from its treasury to a new wallet. In particular, crypto community figure Octoshi first drew attention to the scam. He described a series of suspicious fund transfers and the sudden inactivity of the project.

CARPET WARNING 🚨

Yesterday, ETHTrustFund (@ethtrustfund_ (now deleted) sent +2 million dollars from the treasury to a new wallet, after months of deliberate inactivity from the developer, it seems he decided to steal the funds 👇 pic.twitter.com/YcswifyHmQ

— Octoshi.eth (@0ctoshi) July 21, 2024

According to Octoshi, the project’s developer, known only as “Peng,” has been unresponsive for the past three months. This period of silence followed months of building trust and raising more than $2 million for ETHTrustFund’s treasury. The project’s website has since been taken offline and its social media accounts have been deleted.

ETHTrustFund marketed itself as a fork of OHM, capitalizing on the interest of the Base network community. The network attracted significant investment by capitalizing on the excitement around memes and ETFs. Documentation of the project still exists, but all other traces have disappeared.

Blockchain security firm PeckShield confirmed the scam claim, revealing that the scammers had already laundered the stolen funds.

The perpetrators connected the funds from the Base network to Ethereum (ETH) and then used Tornado Cash and Railgun, known for their privacy features, to conceal the trace of the stolen assets.

Etherscan data confirms these findings, showing that the developer embezzled 607 ETH, equivalent to $2.1 million.

Detailed transaction logs from Etherscan show that one of the developer’s primary addresses moved 200 ETH to Railgun at 13:27 UTC. Shortly after, that address moved another 200 ETH to Tornado Cash in two separate transactions. An additional 56.9 ETH was then transferred back to Railgun.

Recently, Base has become the center of rug pulling as market participants attempt to capitalize on the growing FOMO around the network.

Last August, $6.4 million was deposited into Magnet Finance, a protocol on Base.
Solana has also had its fair share of rug pulling, one related to the URF meme coin and the other to the CONDOM meme coin project. Both of these rug pullings occurred in April.