Unmasking Frauds on Ethereum Layer-2 Networks by ZachXBT
Malicious Actors Targeting Ethereum Layer-2 Networks
In an extensive report, ZachXBT disclosed that the fraudulent syndicate successfully laundered around $1 million in illicit funds. The group is now using these funds to entice unsuspecting individuals to Leaper Finance, a decentralized lending protocol operating on the Blast network. Expanding their nefarious activities, ZachXBT has uncovered potential links between the group and another lending protocol named Zebra Lending, situated on the Base network.
Connections to Zebra Lending and Glori Finance
The investigator highlighted that the deployer of Zebra Lending is associated with an address connected to funds from Lendora and Magnate Finance protocols. Zebra Lending boasts over $300,000 in assets locked within its protocol. Additionally, the syndicate's connections extend to Glori Finance, a cross-chain lending protocol established on Arbitrum, holding approximately $1.4 million worth of digital assets.
Fraudulent Project Patterns
ZachXBT noted that each fraudulent project highlighted in the report was a Compound V2 fork. Compound is a decentralized protocol enabling users to lend and borrow crypto, with governance facilitated by its native COMP token. Data from DeFiLlama positions Compound among the top five lending platforms, boasting a Total Value Locked (TVL) of $2.57 billion.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.