A hot new cryptocurrency that has gathered a lot of attention and investment might actually just be a scam designed to steal people’s money, researchers have claimed.
According to experts from Check Point Research (CPR), the developers behind Dingo Token designed the smart contract in a way that allows them to manipulate the fees and drain user’s wallets.
Every cryptocurrency has fees – micropayments designed to incentivize people to participate in the network and be rewarded for validating the transactions. But while fees are usually low-cost (with exceptions, obviously), Crypto Dingo Token owners included a function in the smart contract allowing them to ramp up the fee to 99%.
A “clear scam”
CPR says the owners can take 95% of the transaction in “taxFee”, and an additional 4% in “LiquidityFee”. So far, the function has been used 47 times.
Crypto Dingo Token is currently ranked #5462, with a market capitalization of $4,159,936.
“The Dingo Token is a clear scam. We found a backdoor code added to the token smart contract that allows the owner to change the fee charge,” said Oded Vanunu, Head of Products Vulnerabilities Research at Check Point Software. “They changed it to a staggering 99% fee. This is a common tactic that locks users’ funds and eventually the scammers pull out all the money.”
According to Vanunu, cryptocurrencies are a great industry for scammers as they allow for all sorts of malicious campaigns, all the while keeping their identities (opens in new tab) a secret. After all, most cryptocurrencies are pseudonymous, allowing people to obtain large sums of money while remaining anonymous.
“Scammers are increasingly finding cryptocurrency attractive. They can stay anonymous. It’s fast. It’s lucrative. If you’ve incorporated crypto into your investment portfolio or are interested in investing in crypto in the future, you should use credible exchanges and buy from an established token with numerous transactions behind it.”
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