BSC-based DeFi project Meerkat loses $31m after launch

By: Ali Raza
Ali Raza
Ali plays a key role in the cryptocurrency news team. He loves travelling during his spare time and enjoys… read more.
on Mar 6, 2021
  • Binance Smart Chain-based DeFi protocol Meerkat Finance recently lost $31 million.
  • The incident involves a hacking attack, at least according to the project’s statement.
  • However, many believe it to be an exit scam, since its website, Twitter, and developers disappeared.

Losing money while trading cryptocurrencies is nothing surprising or new, and every trader learns that sooner, rather than later. However, for a project to lose $31 million worth of crypto a day after launch is scandalous, at best. This is exactly what happened to a DeFi project called Meerkat Finance, which recently launched on Binance Smart Chai (BSC).

Meerkat Finance Loses $31 Million in Crypto One Day After Launch

After seeing the launch on Binance’s new blockchain, the project was seemingly doing great. Until one day later, that is, when its developers announced that the project was hacked, and that the attackers made off with $31 million in BNB and BUSD.

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The project, which is a yield farming protocol, simply announced that someone raided its wallet and drained $31 million. Apparently, the alleged hackers stole $13.96 million in BUSD, and another $17.4 million in BNB.

However, there appear to be several things that don’t add up, which caused a lot of people to doubt the project’s statement. Instead of being hacked, many now seem to believe that the project was an exit scam, and that developers were the ones who took the money and ran.

Investors’ Suspicion Continues to Grow

This suspicion is more than justified for a number of reasons. First, the project’s Twitter account and website went offline after the statement was made. Next, the founders of the projects seem to have disappeared, as they cannot be reached by any means. Not to mention that the only way for someone to raid the smart contract would be to obtain the private keys, which should have been protected by the developers.

With the project being launched on Binance Smart Chain, Binance made a move to investigate the matter immediately, even though it stressed that it has no ties to the project itself. The Chain itself has been heavily criticized for its alleged centralization, but if the project does turn out to be an exit scam, this could prove to be quite handy for investors who lost their funds.

In any case, many are calling the incident the greatest fraud on Binance Smart Chain to date, and the exchange itself seems to be left putting out fires and fighting against various allegations.

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