Solana Ecosystem Shrouded in Apprehension and Ambiguity Following Accusations of Rug-Pull Scam

Solana Ecosystem Shrouded in Apprehension and Ambiguity Following Accusations of Rug-Pull Scam

The Optimistic Phase and Recent Setback

With the cryptocurrency market experiencing optimism, the Layer-1 network Solana witnessed a surge in user interest. However, concerns arose within the Solana ecosystem when social media accounts were disabled following reports of lost funds related to MangoFarmSOL, raising suspicions of a potential rug-pull scam.

Initiation of the Process

MangoFarmSOL, presented as a farming protocol on Solana, pledged “unique yields in the SOL space.” As per a Medium post on January 5th, the distribution of MANGO tokens was slated for January 10th. Users were required to deposit Solana into the protocol to participate in the event.

The pseudonymous developer of Delegate, “Foobar,” raised concerns on January 6th, warning that the project’s front end was at risk. Having been recently appointed as the security auditor of MangoFarmSOL, Foobar responded to users’ inquiries by suggesting the possibility of a rug-pull scam.

Shutdown and Estimated Losses

MangoFarmSOL’s official profile and website were abruptly shut down. A Telegram channel with over 1,000 subscribers is no longer accepting members. The estimated losses in this incident are around 2 million dollars.

Alarming Developments in the Solana Ecosystem

Users shared images of messages reportedly left by the scam’s developer. The messages indicate that the developer claimed coercion into creating a Ponzi scheme and involvement with another Solana-based staking protocol, BananaMiner. However, representatives of BananaMiner denied any connection with MangoFarmSOL:

“I manage all communication for BananaMiner, and I assure you that Mango has nothing to do with us. They even asked me to help them with their project, and I explained to them that there was a conflict of interest. Please do not spread such false rumors and do your research well next time.”

The Solana ecosystem has recently become a target for scammers employing wallet drainers. Since December, there has been an increase in attacks, with cybercriminals selling Solana drainer kits. According to blockchain security firm Chainalysis, one of the largest online communities for SOL wallet drainer kits has more than 6,000 members.