Ghost Tokens: Multi-Million Dollar Fake Crypto Asset Scam Exposed

A team of researchers from Check Point has uncovered a new type of scam involving fake tokens. Using their proprietary Threat Intel system, the specialists identified a malicious crypto wallet involved in illegal operations. Monitoring the activity of this wallet led to the discovery of 40 different scams carried out using the Rug Pull method, resulting in a total theft of $1 million.

How the Scam Works

The essence of the scam is the creation of fake tokens and depositing funds into a liquidity pool to create the appearance of legitimacy. The scammers then organize fake trades to simulate real buying and selling activity. By artificially inflating the token’s volume, they create the illusion of high demand to attract buyers. Once enough investors are lured in, the scammers withdraw the funds from the liquidity pool.

Case Study: GROK2.0 Token

As an example, the researchers highlighted the GROK2.0 token, whose name may have been borrowed from the artificial intelligence system GROK, recently promoted by Elon Musk. The scammers used two smart contracts to trade and artificially boost the token’s volume. One of the contracts was activated 226 times for this token alone. The second smart contract used a different address and was involved in another operation to artificially increase the token’s volume. The scammers managed to withdraw funds from their liquidity pool 81 times.

Rug Pull Schemes and Investor Awareness

Rug Pull schemes are very similar to classic exit scams, where fraudsters make false promises and then disappear with the money. This incident highlights the importance of vigilance and awareness in the ever-changing world of cryptocurrency. Investors should be aware of scam tactics and carefully monitor their investments.

Check Point’s Ongoing Efforts

Check Point experts have committed to protecting the crypto community by actively monitoring domains associated with the identified scammer’s wallet.