Rugpull Exit Scam: Investors Cry Foul as Solana Farming Pool Disappears with Millions

MangoFarmSOL, a Solana-based yield farming protocol, is suspected to have rug pulled after abruptly shutting down its social media presence and restricting access to its Telegram channel. Prior to the shutdown on January 6th, pseudonymous developer Foobar, who had recently been assigned to audit MangoFarmSOL’s security, warned that the front-end had been compromised.

Keypoints

• MangoFarmSOL’s social media accounts and website were abruptly deactivated after funds were reported missing from the protocol
• Users suspect a rug pull as the Telegram channel was restricted and estimated losses are around $2 million
• The pseudonymous developer Foobar had recently been appointed as a security auditor and warned that the front-end was compromised
• Screenshots circulated showing the developer claiming he was forced to create Ponzi schemes and suggesting involvement with another project BananaMiner
• Representatives from BananaMiner denied any connection to MangoFarmSOL, though admitted they were approached for collaboration

Losses from the apparent exit scam are estimated around $2 million. The allegations surface just days before MangoFarmSOL’s planned airdrop of its MANGO governance token on January 10th, which required users deposit Solana tokens to qualify.

mangofarm frontend compromised, don’t use

— foobar (@0xfoobar) January 6, 2024

Screenshots circulated on social media showing messages allegedly from the developer behind MangoFarmSOL claiming they were forced to create “Ponzi schemes” and suggesting involvement with another project, BananaMiner. However, representatives from BananaMiner strongly denied any association, though admitted they had been approached by MangoFarmSOL about potential collaboration but declined due to a conflict of interest.

I manage @BananaMiner_ communication, on the whole project, and I can assure you that Mango has nothing to do with us.
They even asked me to help them with their project and I explained to them that there was a conflict of interest, please don’t spread false rumors like that and… https://t.co/5eMjBtQNEd

— MomoBigIcy (@MomoBigIcy) January 6, 2024

The abrupt shutdown of MangoFarmSOL’s online presence and restricting of its Telegram channel to new members has fueled suspicions of an exit scam, also known as a “rug pull,” whereby developers make off with investor funds. The DeFi space is rife with such scams preying on the get-rich-quick dreams of crypto investors.

However, the developer’s messages alluding to being forced to create Ponzi schemes suggest potential coercion from scammers lurking in the shadows. The solicitations between legit DeFi protocols and potential scam projects highlight the need for enhanced security and due diligence.

MangoFarmSOL’s rug pull contributes to the increasing attacks on Solana’s budding DeFi ecosystem. According to blockchain security firm Chainalysis, underground communities dedicated to stealing crypto funds using Solana wallet drainers have amassed thousands of members.

The Solana community continues working to secure the network and educate investors to avoid falling prey. The ecosystem shows strong growth and adoption despite the fraudsters seeking to exploit it. With milestones surpassing Ethereum in stablecoin volume and NFT sales, Solana maintains its trajectory to becoming a top blockchain as it celebrates its achievements alongside its afflictions.