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    Home » Crypto News » This Crypto Investor Lost $140,000 Worth of Uniswap Tokens to a Yield Farming Scam

    This Crypto Investor Lost $140,000 Worth of Uniswap Tokens to a Yield Farming Scam

    Author: Anthonia Isichei

    Last Updated Oct 5, 2020 @ 22:13

    An anonymous user has reportedly lost around $140,000 worth of Uniswap UNI tokens to a yield farming scam.

    Yield chasers in search of the next “DeFi gem” are falling victim to elaborate scams with rogue actors on the prowl, using cleverly devised malicious contract codes to steal funds.

    From “rug pulls” to outright absconding with presale funds, the activities of DeFi scammers are threatening to overshadow the novel developments in the emerging crypto market niche.

    DeFi Farming Hopeful Loses 36,000 UNI Tokens

    Tweeting on Oct. 5, Alex Manuskin, a researcher at crypto keyless wallet maker ZenGo, revealed that an anonymous “Chad” with the moniker Jhon Doe unknowingly lost UNI tokens worth $140K. This loss came as a result of Doe’s participation in a fraudulent yield farming project.

    The anonymous yield chaser seeking to leverage on the yield farming hype decided to put some of his UNI tokens in UniCats, a new DeFi scheme. The project allows investors to farm its MEOW tokens, after which they can withdraw their tokens.

    And That’s Where Things Went Wrong

    However, events took a left turn for the would-be-Chad as malicious codes in the project’s contract allowed the dev to withdraw the victim’s UNI tokens. This theft was possible because of an earlier approval grant by Doe for the project to spend an unlimited number of UNI tokens.

    Commenting on the enormity of the error, Manuskin remarked:

    “What Jhon doesn’t know is that once you approved the contract to use ∞ tokens, the contract can take their tokens at any time. Even after they were withdrawn from the farming scheme.”

    The rogue dev reportedly siphoned 36,000 UNI tokens in two separate heists bringing the rogue actor’s loot to about $140,000. According to Manuskin, the scammer is a regular token thief who often creates phony farming protocols to fool unsuspecting yield chasers. Apart from fishing for new victims, the UniCat con artist is also reportedly using Tornado Cash, a crypto mixer, to obscure fund transfers.

    Jhon Doe’s case is one of the many fraudulent actors taking advantage of the DeFi craze. Most DeFi projects turn out to be pump and dump schemes. As reported by CryptoPotato in September, DeFi projects HOTDOG, and PIzza saw their values skyrocket before becoming worthless within minutes.

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    Read more on: DeFi Ethereum Uniswap

    About The Author

    Anthonia Isichei View more posts by this author

    Anthonia is a fintech writer who has been involved in the crypto space since 2017 covering developments across regulations, adoption, and several other aspects of the Industry. When not neck-deep in the crypto news cycle, Anthonia spends her free time globetrotting and playing video games.

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