The SeaSwapSui decentralized finance protocol, operating on the newly launched Sui network, has left investors reeling as it disappears from the social media landscape. According to CertiK, a blockchain security firm, the SeaSwap founders executed an emergency withdrawal of SUI from the project’s token sale contract, making off with approximately $32,000 worth of assets.
We are seeing an exit scam from @SeaSwapSui, which has deleted Twitter and abandoned social channels.
The admins invoke emergency withdrawal of SUI from the token sale contract for a total of 32787 SUI ($32k).
More information 👇https://t.co/vAFrLNtbbU
— CertiK Alert (@CertiKAlert) May 26, 2023
Further investigation by Crypto Economy into the matter showed that the project’s social media presence, including its Twitter account, has become inaccessible. In addition, its Discord server has been abandoned by both administrators and moderators, further deepening the veil of uncertainty surrounding the project.
SeaSwap had promised to be a decentralized exchange (DEX) built on the Sui blockchain, facilitating swift and secure cryptocurrency exchanges. The protocol employed an automated market maker system, integrating a central limit order book to offer liquidity and real-time trading at market rates.
The project’s whitepaper touted additional opportunities for generating income through liquidity provision and staking, thereby enticing investors. However, it has now become evident that SeaSwapSui was nothing more than an elaborate scam.
Suipiens raised some red flags on SeaSwap
Interestingly, a vigilant community known as Suipiens, which specializes in analyzing and reporting news within the SUI blockchain ecosystem, had previously raised concerns on May 22 about irregularities associated with SeaSwapSui. Suipiens noted that the project’s domain had been registered a mere five days before the Sui Mainnet launch, raising suspicions about its long-term viability and intentions.
2/ Most of the functions on their website https://t.co/tOrrYgOT1f are fake/not working.
The Liquidity and APR figures are just symbolic figures.
Lmao, Sui even doesn't have the official MATIC token. pic.twitter.com/pu8EVIU5yq— Suipiens 🦍💧 (@suipiens) May 22, 2023
Furthermore, Suipiens discovered numerous red flags, suggesting fraudulent activities. Key functionalities on the SeaSwap website, such as liquidity and APR figures, were either fake or non-functional. To make matters worse, sections of the project’s documents and whitepaper were allegedly copied from other projects.
“We tried to contact the team for more information, and [we] hope that we made a mistake,” Suipiens concluded. “However, they refused to provide any further information.”
Protecting against exit scams
Exit scams, unfortunately, are not uncommon in the cryptocurrency space. These scams involve the sudden disappearance of project developers or founders who abscond with investors’ funds. Exit scams can be executed in various ways, including outright closure of the project and appropriation of funds, cessation of withdrawals, or even selling the project to new owners while pocketing the lion’s share of the proceeds.
To protect themselves from such scams, investors should exercise caution and due diligence. Only invest in projects with a trustworthy reputation after conducting thorough research on the team and project details. It is crucial to invest only funds that one can afford to lose and to be skeptical of projects promising unrealistic returns. Additionally, investors should remain vigilant for warning signs of an exit scam, such as abrupt changes in project leadership and a lack of communication from the team.
Raising awareness about potential scams on social media platforms or through other channels can also help protect other investors, just as Suipiens bravely did when alerting the public about the IDO Seaswap.
