DexTools/Uniswap Fake Buy/Sell History
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With decentralized platforms, a major problem of fraud can happen with fake tokens. Given the open nature of the blockchain, anyone can list a new token with a similar name to an existing popular token, and using smart contracts it's possible to prevent or limit the sale of tokens, meaning that investors can buy, but not sell, the token, while the token developer can sell their own tokens to create realistic trading activity.
This is a global/international case not involving a specific country.
About DexTools
"Real-time data analysis at the tips of your fingers: Create unique trading strategies, anticipate market movements, search for big spreads, track and copy the most profitable wallets and much more."
"DEXT is a multifaceted, interactive trading tool that will be paramount in your trading success. Currently ending their beta, DEXT provides trading tools such as: DEXTboard, Pool Explorer, Pair Explorer, Big Swap Explorer, Token Catch, Spread Hunter, and various other functionality for a multitude of exchanges. This includes Uniswap and IDEX with tangible, working products. DEXT has the ability to integrate their tools to work with additional exchanges such as Mooniswap, Sushiswap, and Kucoin which are all coming soon. Due to how responsive the devs are, if the community wants other exchanges included, they are willing to include them too! Whether it’s a DEX or CEX, DEXTools has the ability to help navigate your trading experience."
"Users’ trust in well-curated platforms, as well as their low experience in interpreting data and code, can render even the most credible dapps and DEXs susceptible to high rates of fraud."
"Another example of advanced fraud is contract manipulation. Twitter user and self-professed anti-rugster, R0฿ST3R, explains how scammers with programming knowledge can exploit the legitimate function of apps like DEXTools, a dapp providing real-time crypto market data analysis, to produce fake, convincing contracts that mimic legitimate code to the untrained eye.
"[T]his tx is NOT coming from the developer wallet. If that's the case it checks for the allowance. If it DOES come from the developer this gets skipped." "[T]he developer wallet doesn't need any "allowance" to transfer tokens from any "_from" wallet to e.g. his own wallet. So: Dev can steal the tokens out of your wallet at any time!" "Uniswap can't take your tokens if your wallet is blacklisted." "The owner / developer can blacklist anyone he wants to." "That means you won't be able to sell!" "[A]s a default investor you can buy the token but you won't be able to sell them."
"After deployment of the contract the developer got all tokens (total supply) and used the "batchSend" function so send batches of 125,000 $YLD to multiple addresses (all owned by him)." "All developer wallets can skip the approval and always sell. So the developer uses these 40+ wallets to sell tokens and make the history on DexTools looking legit." "[E]very selling wallet you find on DexTools at this pair is one of the wallets from the "batchSend" function call."
This is a global/international case not involving a specific country.
The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.
Include:
- Known history of when and how the service was started.
- What problems does the company or service claim to solve?
- What marketing materials were used by the firm or business?
- Audits performed, and excerpts that may have been included.
- Business registration documents shown (fake or legitimate).
- How were people recruited to participate?
- Public warnings and announcements prior to the event.
Don't Include:
- Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
- Anything that wasn't reasonably knowable at the time of the event.
There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.
The Reality
This sections is included if a case involved deception or information that was unknown at the time. Examples include:
- When the service was actually started (if different than the "official story").
- Who actually ran a service and their own personal history.
- How the service was structured behind the scenes. (For example, there was no "trading bot".)
- Details of what audits reported and how vulnerabilities were missed during auditing.
What Happened
The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.
| Date | Event | Description |
|---|---|---|
| December 13th, 2020 12:00:00 AM | First Event | This is an expanded description of what happened and the impact. If multiple lines are necessary, add them here. |
Total Amount Lost
The total amount lost is unknown.
How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?
Immediate Reactions
How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?
Ultimate Outcome
What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?
Total Amount Recovered
It is unknown how much was recovered.
What funds were recovered? What funds were reimbursed for those affected users?
Ongoing Developments
What parts of this case are still remaining to be concluded?
Prevention Policies
Such fake tokens can easily be avoided by trained platform operators. In cases where operators are tricked to accept an illegimiate version of a popular token (which has never yet happened historically) platforms should make affected users whole. We've proposed an industry insurance fund that could cover such unlikely events.
References
Crypto Scams are Out of Control, Again... Here's How to Stop Them Forever - The Defiant - DeFi News (Aug 26)
R0฿ST3R (@r0bster97) | Twitter (Aug 26)
@r0bster97 Twitter (Aug 26)
DEXTools.io (Aug 21)
Dextools Summary (Aug 21)