The astrology-themed NFT project Lucky Star Currency (LSC) has performed an exit scam for over $1 million, according to an October 9 report from blockchain security firm Certik.
The project’s deployer account called the ‘withdrawToken’ function on both the NFTMerge and AdwardCenter contracts, removing over $1 million in LSC from them. These tokens were then swapped for Binance USD (BUSD) stablecoin and sent to another account.
The company that promoted the project claimed to have an office in Shenzen City, China.
Lucky Star Currency office, Shenzhen, China. Source: Certik, Telegram
Rug-pulls from Chinese projects have become a recurring problem in the Web3 space. Running a centralized cryptocurrency exchange is illegal in the country. Because of this, users who deposit to a Chinese protocol that has centralized elements may risk having their funds confiscated by police.
Over $100 million were lost in July when the China-based Multichain protocol drained all of its users’ funds into an attacker’s account. The team alleges that police have arrested their CEO, but victims still search for answers as to what happened to their funds and how they can be reimbursed.
