350 scam tokens per day 😱

Good Morning, Switchers 🌞

👋Welcome to Switch Daily.

All geared up to head into mid-week? We’ve got some news for the Ethereum fanatics in the house—the whales are active. Two dormant ETH wallets that had been inactive for over five years suddenly woke up and made two transfers totalling 22,983 ETH. The transfers were worth more than $27 million at current prices. 🐳

These large amounts of ETH are being moved from exchanges to fresh wallets. This could be a good thing because if the HODLers are moving their crypto assets away from exchanges, it indicates that they intend to HODL further, and there may not be any impact on Ethereum’s price.

BTW, if you like reading this newsletter, give us a shout-out on Twitter and get your friends to subscribe. It will mean a great deal to us!

Here’s what we’ve got for you today: 

• Market pulse

• Rug pulls - 2022 edition

• Piping hot news

• Meme of the day

Market pulse 📈

The market is still as a statue 🗿

The market seems to have started off at a good note this morning with the major coins Bitcoin and Ethereum showing a slight uptick of 0.14 and 0.78% respectively. The global cryptocurrency market cap remained below $1 trillion today, falling more than 1% in the last 24 hours to $841 billion.

Other crypto prices' performance today was mixed, with Binance USD, Avalanche, Tether, Terra, Solana, Polygon, Stellar, XRP, Cardano, Uniswap, and Polkadot prices trading lower over the last 24 hours while Litecoin, Chainlink, ApeCoin, and Tron prices trading higher. Dogecoin saw over 5% after Twitterati’s voted for Elon Musk to step down as the leader in a poll.

C'mon, aren't you gonna let your friends in on how the market is performing today?

350 scam tokens per day…

350—That’s how many fraudulent crypto tokens were generated on a daily basis. 

And how do we know about it? Yesterday, we happened to stumble upon a super interesting report on rug pulls published by blockchain risk monitoring firm Solidus Labs.

Before we talk further, what exactly are rug pulls?

Rug pulls involve a group of individuals or a single individual creating a fake or low-quality crypto project with the intention of tricking people into investing in it. 

The goal of the scam is to generate hype and buzz around the project, encouraging more people to invest in it. As more and more people invest, the price of the crypto will likely go up, leading to even more interest and investment.

However, once the hype has reached a peak and the price of the cryptocurrency has reached its highest point, the individuals behind the scam will "pull the rug" out from under investors by suddenly selling off all of their holdings and disappearing, leaving investors with a worthless asset and no way to recoup their losses. Very much like a Ponzi scheme, no?

Okay, now tell me more about the number 350! 

According to the report, between Jan 2022 and Nov 2022, fraudsters created over 1,17,629 ‘scam’ tokens, a whopping 41% increase since 2021, which saw 83,368 tokens. So simple math: 

1,17,629 / 365 = 350 average scam tokens per day in 2022. 

The network with the highest number of scam tokens is the BNB. Over 12% of all the BNB projects end up being a scam. Ethereum network stands second with over 8% of all Ethereum tokens programmed to execute rug pulls. 

And how do these scammers get through to innocent folks? Scammers use crypto-to-fiat exchanges to seed scams and launder proceeds. They have deposited and withdrawn $11 billion worth of ETH to/from 153 different CeFi exchanges. 

The five jurisdictions with the most exposure to these exchanges are the United States, Seychelles, the Bahamas, the Netherlands, and Hong Kong. But the good news is that India is not on that list. 

The CeFi exchanges in India, although unregulated, follow due diligence while listing coins on their platforms. It is one of the reasons why CoinSwitch took a long time to list Shiba Inu on its platform. 

While the exchanges do their bit to keep you safe, it is important for you to be cautious and do thorough research before investing in any cryptocurrency project. Rug pulls can be difficult to detect and often target inexperienced investors. 

So it is best only invest what you can afford to lose and to diversify your investments to mitigate the risk of being affected by a rug pull. And, of course, DYOR!

What else is trending? 🔥

🦧Over $1 million Bored Ape collection stolen

The recent breach resulted in the theft of 14 Bored Ape Yacht Club NFTs via a sophisticated scheme involving high-level social engineering from a single owner. The hacker quickly liquidated the NFTs for approximately 850 ETH, or slightly more than $1 million.

💳Visa could work with Ethereum for automated crypto payments

On Monday, global payments giant Visa signalled its continued interest in cryptocurrency by releasing a paper outlining how the company could one day collaborate with the Ethereum network on automatic payments.

💜Polygon’s unique addresses cross 200 million

According to data posted by Polygon co-founder Sandeep Nailwal, the number of unique addresses on the Polygon network has surpassed 200 million. The NFT market and dApps on Polygon may have played a significant role in the collection of these new addresses.

Meme of the day!

Thank You,

See you later, folks. 👋

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