CoinMarketCap-led token airdrops ‘infected by fraud,’ crypto project claims

Two crypto projects person cried foul play implicit promotional airdrops conducted by CoinMarketCap (CMC) connected their behalf, which they allege was "gamed" for the payment of a tiny radical of exploiters.

These promotional airdrops — designed to beryllium distributed to thousands of wallets to rise consciousness of a crypto task — ended with the tokens funneling to conscionable a fistful of wallets, suggesting imaginable manipulation of the system.

SATT token driblet

Blockchain advertizing solution SaTT alleged to Cointelegraph that a promotional airdrop it paid CMC to behaviour successful Dec. 2022 ended with 84% of the airdropped tokens funneling to conscionable 21 wallets.

The promotion was meant to spot 25,000 winning wallets person 4,000 SATT each, worthy $6.30 astatine the clip per CoinGecko data.

However, SaTT claimed that soon aft the airdrop was distributed, 20,953 wallets “automatically transferred the tokens to 21 wallet addresses” which past sold disconnected their token holdings days aboriginal astir Dec. 10, netting astir $142,000 for those 21 wallet owners.

The sell-off plunged the terms of SATT by 70% betwixt the extremity of the airdrop connected Dec. 1 to erstwhile the wallets sold their tokens connected Dec. 10.

SaTT claims wallet 0x929… (pictured) has implicit 4,500 transactions of its token, the largest it recovered retired of the 21. Blockchain information shows the wallet sold implicit 4.3 cardinal tokens done PancakeSwap. BscScan

TokenBot token drop

A akin acquisition was shared by TokenBot co-founder Shaun Newsum, who told Cointelegraph that it did a akin CMC-led airdrop of its TKB token connected Dec. 9.

Newsum said CMC provided its 30,000 airdrop winners but helium chose to “stagger” the airdrop “just successful lawsuit thing happens.”

TokenBot sent retired its tokens to a batch of 4,000 winners to start, but astir 3,300 ended up sending the funds to 1 wallet, said Newsum.

Blockchain information shows thousands of TKB transactions flowing to wallet 0x5AF… earlier initiating a cross-chain swap and past selling its holdings. BscScan.

Newsum said astir $20,000 was mislaid by TokenBot successful the incidental and the task had to deploy much liquidity from its treasury.

“Obviously immoderate idiosyncratic figured retired however to crippled CMC,” helium added. “If we were to person bulk sent, the full airdrop would’ve been a implicit disaster.”

Newsum nevertheless said helium has since received an apology from CMC and was told that it was investigating the airdrop and would instrumentality with an updated winners database for the project.

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In its investigation, SaTT claims to person recovered different 18 tokens oregon nonfungible tokens (NFTs) airdrops conducted by CMC since Jul. 2022 that were besides allegedly “infected by fraud” to the tune of $6.6 million.

This included airdrops for projects including TopGoal, OwlDAO and AgeofGods.

SaTT theorized 2 possibilities of however the “fraud” occurred:

“Either a radical of hackers injected tons of fake accounts [into the airdrop connected CMC’s website] [...] oregon it was really an wrong job.”

CoinMarketCap responds

Speaking to Cointelegraph, a CMC spokesperson addressed immoderate of these claims, arguing that astatine slightest 4 of the projects identified by SaTT person yet to administer rewards, meaning it would beryllium “impossible” for them to person faced “malicious” activity.

It besides noted that portion 3 projects, including SaTT, AgeOfGods and TokenBot person spoken to the CMC squad astir their concerns, it has not received immoderate communications from different projects astir the alleged issues.

The spokesperson nevertheless acknowledged that “bots are an contented that touches astir each industry.”

“The manufacture has been facing this contented among airdrop programs for immoderate clip and the world is that not a azygous manufacture has been capable to lick the bot contented entirely.”

“We are continuously moving to amended our systems and services to bounds this contented and volition enactment intimately with these projects to find solutions and assistance resoluteness immoderate existent issues,” the spokesperson added.

Related: Crypto’s betterment requires much assertive solutions to fraud

CMC added that immoderate claims of bot participation successful its airdrops are taken “very seriously” and itis “working connected resolving each lawsuit individually.”

It besides shared respective features it has employed to deter bot participation, specified arsenic a CAPTCHA situation and email verification requirements for participants. It’s besides processing a two-factor authentication integration.

Cointelegraph contacted TopGoal and OwlDAO for remark but did not person a effect astatine the clip of publicati. AgeofGods could not beryllium reached for comment.