SwirlLend Vanishes in $460k Crypto Community Aghast

SwirlLend Vanishes in $460k: Crypto Community Aghast

News, Altcoin news

In a startling turn of events, the layer 2 lending protocol, SwirlLend, has vanished into thin air, leaving the DeFi community stunned and investors in distress. The platform, once brimming with promise, is now the center of attention due to an exit scam that has siphoned off approximately $460,000 from Base and Linea, triggering a wave of panic among users and observers alike.

Details of the Exit Scam

PeckShieldAlert, a well-known security researcher, has shed light on the grim reality surrounding SwirlLend’s abrupt disappearance. The protocol’s Total Value Locked (TVL), which previously stood at an impressive $784,000, has plummeted to a mere $49 in the wake of the exit scam. The once-thriving lending protocol has suffered the extraction of $290,000 from Base and an additional $170,000 from Linea, showcasing the audacity of the scheme.

This orchestrated heist has not gone unnoticed. PeckShieldAlert has uncovered that the scammer behind the exit has managed to move around 94 ETH from Linea to Ethereum via the Orbiter Finance Bridge. Currently, the ill-gotten gains from Base are also being transferred to Ethereum, further highlighting the scammer’s cunning tactics. The ongoing movement of these stolen funds is a stark reminder of the challenges faced by the DeFi space in curbing fraudulent activities.

Deactivation of SwirlLend’s Online Presence

Adding to the intrigue, SwirlLend’s online presence has vanished without a trace. Its Twitter account and Telegram channels have been deactivated, leaving users with a sense of abandonment and raising suspicions of a rugpull. Just a day before the exit scam, the platform’s website was fully functional; now, it stands as a testament to the swift and devastating nature of such scams.

User Claims and Token Manipulation

Amidst the chaos, a Twitter user has come forward with claims that certain privileged addresses associated with the project engaged in questionable activities. Allegedly, over 230 Ether was borrowed from the protocol’s lending pools, and a sizable chunk of 47 Ether was swapped out from the trading pools using SwirlLend’s native SWI tokens. This exploitation of the protocol’s mechanisms has only exacerbated the losses suffered by investors.

Coinbase’s Base in the Spotlight

The SwirlLend exit scam has inadvertently cast a spotlight on Coinbase’s Base platform. This is not the first time that Base has faced such issues, as a similar rugpull involving Bald memecoin occurred in the past. The recurrence of such incidents raises concerns about the platform’s security measures and its ability to protect users’ investments.

As the DeFi landscape continues to evolve, incidents like the SwirlLend exit scam serve as a stark reminder of the need for heightened vigilance and robust security mechanisms. Investors and users must exercise caution while navigating the intricate world of decentralized finance, and platforms must prioritize fortifying their defenses against malicious actors.

In conclusion, the SwirlLend exit scam has sent shockwaves through the DeFi community, leaving a trail of financial losses and shattered trust. The aftermath of this incident underscores the imperative for continuous scrutiny, transparency, and diligence within the DeFi ecosystem. As the industry learns from these unfortunate events, the hope is that it will emerge stronger and more resilient, with renewed determination to safeguard the interests of all stakeholders.

Coinbase, ETH