The cryptocurrency market has once again fallen victim to a rug pull, this time involving the token Crypto Emperor Trump ($TRUMP).
According to Coinmarketcap, the $TRUMP token saw a meteoric rise in price over the last five days, going from $0.001693 on Nov. 15 to a high of $0.9284 on Nov. 20, an increase of 54,737%. However, this rapid rise was short-lived as the price of the token plummeted to almost zero ($0.000015), leaving investors with significant losses.
At the time of writing, Uniswap v3 (Base) was the most active exchange for $TRUMP, accounting for the majority of the 24-hour trading volume at $12,698,120.
The Honeypot Trap
The rapid price increase was fueled by intense social media activity, with numerous posts promoting the token and encouraging investors to buy. This created a sense of urgency and fear of missing out (FOMO), driving many to invest without conducting proper due diligence.
However, as it turned out, the $TRUMP token was a classic honeypot scam. Honeypot tokens are designed to attract investors and then prevent them from selling their holdings.
Some investors took to social media platforms like Reddit or X to express their frustration and disappointment. Many reported being unable to sell their $TRUMP tokens, confirming the honeypot nature of the scam. Some investors even suggested that the token may have been specifically designed to target users of Coinbase Wallet, as they were unable to sell the token on that platform.
The availability of scam tokens like $TRUMP on Coinbase Wallet has also raised concerns among the cryptocurrency community. A user with the nickname @XReviewBeast said on X: “It’s concerning that scam tokens like ‘Crypto Emperor Trump’ are available on Coinbase Wallet. This token acts as a honeypot, preventing buyers from selling. Platforms should restrict contracts with such exploitative mechanisms to protect users.”
@coinbase @CoinbaseSupport @CoinbaseExch @CoinbaseWallet @coinbasetraders It’s concerning that scam tokens like ‘Crypto Emperor Trump’ are available on Coinbase Wallet. This token operates as a honeypot, preventing buyers from selling. Platforms should restrict contracts with… pic.twitter.com/tcybLdaiWr
— XReviewBeast (@XReviewBeast) November 19, 2024
Pump-and-Dump Scheme Exposed
According to an analysis of ChainDefenders on X, a significant portion of the $TRUMP token supply was held by a small group of interconnected addresses. Seven of the top holders were linked to a common contract, suggesting a coordinated effort to control the token’s price and distribution.
A large number of previously inactive addresses suddenly began purchasing $TRUMP tokens, contributing to a surge in trading volume. This behavior is characteristic of pump-and-dump schemes, where a group of individuals artificially inflate the price of a token before selling it off at a profit.
Red Flag Alert
Suspicious Activity: Analysis reveals that the 7 top holders of $TRUMP are all tied to a common contract. Additionally, tens to hundreds of… pic.twitter.com/tzRkPWlKBt
— ChainDefenders (@ChainDefendersX) November 18, 2024
91% of Base Meme Coins at Risk
A recent analysis of over 1,000 new tokens on the Base chain, mostly meme coins, also raised concerns about their security and legitimacy.
The study revealed that 908 projects failed to meet one or more fundamental security measures. These include locked liquidity, verified contracts, and the absence of honeypots.
According to the study, this lack of security could stem from creators’ ignorance about proper procedures or an attempt to troll the industry.
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