BALD Token Rug Pull - August 2023
Overview
In late July/early August 2023, the creator behind BALD performed a rug pull stealing $5.9M and costing investors $23M. BALD was a token launched on Base, Coinbase's Layer 2 testnet.
The Exploit and Technical Vulnerability
The project experienced a massive rise in value shooting up 4,000,000% in 24 hours and reaching an estimated $68 million market cap. Much of this growth was attributed to active investments by the deployer, who put in $12 million within the first day and then bought BASE infrastructure tokens, which helped to further raise the price after it stagnated.
The technical vulnerability centered on Base's infrastructure gaps. At the time, BALD had no UI built, making it impossible to bridge to the contract. The only available bridge was unidirectional, bridging back to the Ethereum blockchain. Coinbase's development team urged ordinary users not to use the network, as it lacked a functioning user interface (UI) for its bridge.
The Rug Pull
The anonymous BALD developer removed a lot of the liquidity, sparking allegations of a rug pull. De.Fi's Rekt database labeled it as such, reporting losses of $23 million.
Speculated Connections
On-chain data suggests interactions between the memecoin BALD's deployer contract and one of the wallets tagged by Nansen as belonging to Alameda Research. However, blockchain researcher Igor Igamberdiev noted that while "this is definitely someone from Alameda," he didn't think they could "safely say that this is @SBF_FTX."
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