DeFi Farming Scam

76 135
Avatar for Eybyoung
3 years ago

There was a story of a DeFi yield farmer who lost $140, 000 in UNI tokens without him knowing that he is participating in a fraudulent yield farming project that was revealed by a researcher at a crypto keyless wallet recently.

It was Jhon Doe who lost his $140,000 worth of Uniswap's UNI tokens that was yield on a farming scam. The project was called UniCats, that John Doe the user of Ethereum lost his DeFi tokens, told by the crypto researcher at ZenGo.

UNI was launched in mid September, a Uniswap's governance token to promote many users to its platform and claim the Ethereum based tokens. Uniswap's official announcement was to release 1 billion tokens in the market eventually in the next four years.

Yield farming has been surging popularity due to the high returns of the users able to accumulate by locking up their crypto assets, in the recent months. Some users have fallen into a victim in many scams and bad actors in the industry who are looking funds to steal, despite that there are massive benefits provided by many yielding farm projects to the users.

Yield farming craze has brought many users to expect in making high amout of returns just like Yearn.Finance's YFI tokens that recently surged up an all-time high over $40,000 due to the DeFi craze.

Jhon Doe was seeking to have high returns on the yield farming hype, that he allocated some of his UNI tokens in a DeFi scheme called Unicats, he got scammed explained by a series tweets of Alex Manuskin. UniCats allow users to farm its MEOW tokens, then they can withdraw their tokens.

John Doe let the decentralized application(Dapp) to spend his UNI in an unlimited way and approving all the transactions believing that all the farming Dapps have done it in the past, so he said “Why not?” explained by Manuskin. As he continued to farm the MEOW token, he has made considerable amount of interest then decided to take out his UNI tokens together with the profits but it was too late.

When he approved the contract to used his unlimited permission, the contract enables to take the users token anytime even when they already withrawn their tokens in the yield farming scheme said Manuskin.

“UniCat is a cunning bastard. To cover their tracks, for each new victim, it creates a new smart contract and passes the ownership of the farm to the new contract.”

John Doe's story was unfortunately the tale of cautionary bad and ugly face of yield farming industry in terms of financial losses. It was like a horror experience losing big money on a DeFi farming schemes that turned out to be a scam.


What is yield farming?

Yield farming is a way to make more crypto from your cryptos. It involves lending your funds to others through the used of computer program called smart contract, in return you will receive some fees in a form of crypto with your contributions. As a yield farmers you have to use very complicated strategies, lending cryptos to different markets to maximize returns. Yield farming is done in Decentralized Finance (DeFi), where all farmers are competing to yield the best crops.

What is DeFi?

Decentralized Finance is an innovation in blockchain space, which is permissionless that means anyone can participate with just Internet connection and a supported wallets. They don't need to trust any custodians or middlemen. In short they are trustless. Yield farming was a concept to earn cryptocurrency holding using permissionless liquidity protocols. Allowing anyone to earn passive income by using decentralized ecosystem of “money legos” built on Ethereum blockchain. “Why putting your assets on idle? When you can make them work” that's how yield farming is.

What are the ways of rewarding yield farmers?

Yield farming is done through ERC-20 tokens on Ethereum and the rewards are also in the ERC-20 tokens form. Yield farmers will usually move their funds to different protocols in searching for high yields. DeFi platforms will also provides other economic incentives to attract more capitals in their platform as a result.

References:

https://blockchain.news/postamp?id=140000-uni-tokens-lost-defi-yield-farming-scam-cautionary-tale-jhon-doe

https://academy.binance.com/en/articles/what-is-yield-farming-in-decentralized-finance-defi

1st Image link

2nd Image link

3rd Image link


40
$ 2.63
$ 2.51 from @TheRandomRewarder
$ 0.05 from @Jane
$ 0.05 from @tired_momma
+ 2
Sponsors of Eybyoung
empty
empty
Avatar for Eybyoung
3 years ago

Comments

I hope you win! Go ahead and post it! :)

$ 0.00
3 years ago

Already done, it was approved already haha thanks for the tip and for your wishes 😍

$ 0.00
3 years ago

The internet is full of scams, useful information.

$ 0.00
3 years ago

Exactly, thank you.

$ 0.00
3 years ago

Wonderful information

$ 0.00
3 years ago

Great information about this article my Dear

$ 0.00
3 years ago

Jhon Doe's story is really pathetic. They're so many yield farming out there and it's sure that scam will be among. I only participate in yield farming that are promoted by Trust wallet, Binance, Etherscan and other top crypo organizations like that because I believe they did thorough investigation about it before promoting it to the public.

$ 0.00
3 years ago

Yeah, exactly they are trusted platforms and they will surely not promote any scam because it will stain their reputations.

$ 0.00
3 years ago

These are the exact kind of situations that casue me to be wary of defi. I totally believe in the process, I just am not savy enough to see these scams yet.

$ 0.00
3 years ago

Well, before you take action in participating DeFi project you should do your own research and only participate in trusted platform advertisement..

$ 0.00
3 years ago

Good article, I'm trying to find the best solutions

$ 0.00
3 years ago

Good for you just do your research thoroughly when you want to engage in defi farming.

$ 0.00
3 years ago

It is not cool to get scammed and see your UNI tokens gone from your wallet and out of your control.

$ 0.00
3 years ago

Yes, Sir exactly it's very frustrating to know you lost money from a scam scheme. I hope Johh Doe got his lesson and recovered from it.

$ 0.00
3 years ago

Good article, I'm trying to find the best solutions for crypto staking but there are so many offers that is difficult to make selection...

$ 0.00
3 years ago

There are many legit platform that offer staking, many users here often mentioned Nexo, blockfi, Celsius.network and many more you just have to do your own research before taking actions. As for me I am currently staking at Nexo, you can browse my profile and look for my article “First Time staking in Nexo”..

$ 0.00
3 years ago

Any investment we make is a gamble. Nothing is certain indeed. Anyway, I don't know much about the contest but I think you have a shot on this. Very informative.

$ 0.00
3 years ago

Exactly, the Golden Rule is really needed to invest only what you can afford to lose. Just trying my luck hehe anyway there's no harm in trying.

$ 0.00
3 years ago

That's true!

$ 0.00
3 years ago

Thank you for this very useful informational.It looks quite nice dear.

$ 0.00
3 years ago

Thanks for your appreciation dear..

$ 0.00
3 years ago

Scammer everywhere, and that's really a big amount. Its just sad that there are a lot of people who will scam others just for money.

$ 0.00
3 years ago

Yeah money is the root of evil, so scammers are rampant wanting easy money.

$ 0.00
3 years ago

I hope theybrot in hell foe doing such things. Those legit site will stain their reputation because of that scammer that is raising until today.

$ 0.00
3 years ago

Yeah, that's the effect the legit one will be doubted because of those scammers.. hahaha you really condemned them in hell 😆😅 Have you been a scam lately?

$ 0.00
3 years ago

I got scammed before, it is a site actually. Even if the amount is not that big, still it came from my hard work, so every cents is important.

$ 0.00
3 years ago

Oh, that is sad dear I am also a scam victim many times it's really frustrating but we have to admit that we also have faults for not background checking the site well.

$ 0.00
3 years ago

Thank you for this very useful information about DeFi project

$ 0.00
3 years ago

Welcome 😊

$ 0.00
3 years ago

Welcome 😊

$ 0.00
3 years ago

Smart contract is only a computer program. It's not a computer and nothing magic. Here it was written quite well.

https://read.cash/@arslankhalid/what-is-a-smart-contract-32917374

Simple smart contracts are also possible in the Bitcoin Cash blockchain. Mecenas is one example of this

https://read.cash/@Telesfor/mecenas-recurring-payment-smart-contract-plugin-52fb94ce

$ 0.00
3 years ago

Oh, sorry that was the reference said 😆 I will just edit it huhu thank you sir.

$ 0.00
3 years ago

We should always be careful then po when staking or investing or putting our money in any types either online or personal po as there's so many scammers nowadays po n hope u win po in the contest u r going to join to po n this is a good n informative article po so i guess, my chance po kau :)

$ 0.00
3 years ago

Yes, we should be careful in engaging any investment to avoid being scam.. I hope so Hehe I am just trying anyway, there's no harm in trying.

$ 0.00
3 years ago

Yes po, u wrote a good one n be positive lng po n yes, there's no harm in trying po, good luck po :)

$ 0.00
3 years ago

Yes, thank you so much for your support and encouragement 😊

$ 0.00
3 years ago

U r welcome po n i will try na palakasin at lakasan po ang loob nyo, positive lng po, who knows, kau po manalo dun po :)

$ 0.00
3 years ago

through the used of magic computers called smart contract.

Magic computers? 😂 Is just code. This code decides who to pay, the interest rates and so on. Yield farming is providing liquidity to any platform through the use of this code (the smartcontract). But of course as there's too many out there and very few audited, scams pour like juice.

$ 0.00
3 years ago

Hahaha, actually I just based it on the reference. They stated wrong, or it was just exaggeration lol. Thanks for the correction 😊

$ 0.00
3 years ago

I knew that, It's a scam! When I go for registration, I realise it scam! Maximum of them are scam😑

$ 0.00
3 years ago

Exactly we should be careful in engaging yield farming there are a lot of scammers out there waiting to steal your funds.

$ 0.00
3 years ago

Yeah, you are right

$ 0.00
3 years ago

Good one

$ 0.00
3 years ago

It looks quite nice dear, good luck 🍃🍃

$ 0.00
3 years ago

Oh, thanks dear. I will just try my luck.. 😊

$ 0.00
3 years ago

Sayang non. Pera na naging hangin pa 😂

$ 0.00
3 years ago

hahaha oo nga eh, ganon talaga almost 6million yun sa Php 😅

$ 0.00
3 years ago

Oh it's a huge amount to lose. I don't know why people doing scam all the time. Don't they have heart? Or they are not human.

$ 0.00
3 years ago

Yeah, that's the game of other people who wants easy money stealing other people..

$ 0.00
3 years ago

Humm..they are real ugly people.

$ 0.00
3 years ago

Yeah exactly, thanks for the tip 😊

$ 0.00
3 years ago

No problem, do party now. 😹😹

$ 0.00
3 years ago

Haha maybe later if random rewarder will also tip me 😅😆

$ 0.00
3 years ago

😹😹

$ 0.00
3 years ago

It looks like JohnDoe doesn't want his real identity to be revealed because he's using a pseudonym, Anyway, when I noticed the boom in the numbers of all these Yield Farming projects, I knew at least the majority would be scammers on the prowl. Too bad for him there. $140,000 could have changed my life 😂😭

$ 0.00
3 years ago

Hahaha yeah maybe he does not want to be embarrassed that he was scammed.. Yes I think in all areas in accumulating money there is always schemes that will scam people and John Doe got his badluck..

Yeah that $140,000 could have changed our lives 😅😂

$ 0.00
3 years ago

Either he's embarrassed or he has people that will be surprised that he had 140k dollars. Either way, it's too bad. I'm sure he will steer clear of investments for a while 😂

$ 0.00
3 years ago

Yeah, maybe he is cooling off right now after being scammed with huge amount.. 😆

$ 0.00
3 years ago

😂😂 surely

$ 0.00
3 years ago

Halaaa, sasali ka goodluckkkkkk, ayudaha nalang kami. Peri diko nga ma gets yang farm farm defi na yaan ee, ipasa mo na doon, tapos wait mo comment ni igor, maga comment namn yon doon.

$ 0.00
3 years ago

Hahaha ganon ba mag comments yun don? Tama ba tong gawa ko? hahahha

$ 0.00
3 years ago

Tamang tama, naaproved kana nga inday haha. Goodluck yayy 💪💪

$ 0.00
3 years ago

OMG! $140,000 is not a little amount . Now scammer are in every fields of Crypto. Be careful of these kind of Scam projects. Never judge a project with praising posts or comments. Thank you for sharing.

$ 0.00
3 years ago

Yes, it's huge amount and it's not a joke finding that money.. So we should be careful in engaging any scheme especially when it comes to money matters.

$ 0.01
3 years ago

Nkagawa kna.. Goodluck sa contest 😁 laki prize nun

$ 0.00
3 years ago

Hahaha di ko lang alam tama ba yung ginawa ko 😅

$ 0.00
3 years ago

D ko rn alam, dapat cguro bout sa benefits ng defi farming ginawa mo 😅

$ 0.00
3 years ago

Hahaha basta all about Defi farming nmn eh.. 😅 meron nga ako nakita don simple explanation lang. kaya ganyan lang ginawa ko.

$ 0.00
3 years ago

Ah mganda kung ganun.. My consulation dn nmn cguro ang lahat na sasali

$ 0.00
3 years ago