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First Major Scam Hits Blast Ecosystem: 'RiskOnBlast' Disappears with $1.3 Million in Ether

Overview of the incident

The Blast ecosystem, celebrated for its promising Ethereum layer-2 projects, faced a shocking setback when RiskOnBlast, a platform touted for gambling and exchange, orchestrated the ecosystem's first rug pull. Over the weekend, it emerged that RiskOnBlast had vanished, taking with it over 420 Ether (ETH) — a staggering $1.3 million. This event marked a significant blow, especially after Blast's X post had previously hailed the project's "undeniable" potential, misleading investors into a false sense of security. 

The mechanisms of the scam

RiskOnBlast, purporting to be a robust gambling and exchange platform within the Blast ecosystem, raised over $1 million from unsuspecting investors. This deceitful act culminated in a rug pull, leaving the community in shock as the platform and its anonymous team vanished, redistributing the stolen assets across various cryptocurrency exchanges. Investigations revealed that the stolen funds, amounting to over 420 ETH ($1.3 million), were dispersed in significant sums: nearly $500,000 to ChangeNow, $360,000 to MEXC, and $187,000 to Bybit. 

Onchain researcher SomaXBT highlighted the scam's breadth, noting the involvement of over 750 wallets in the scheme.

SomaXBT (@somaxbt)  

“1.@Riskonblast rugged 420 ETH worth $1.25 million from 750+ victims.
Scammers lent $497k through @ChangeNOW_io , $360k through @MEXC_Official and $187k through @Bybit_Official exchange
contract on L1
0x25f8C342E430C85829Ef5021C0720f0c60969840. 🧵” pic.twitter.com/XK2w2gTo8X

 

This elaborate exit scam not only showcased the vulnerabilities of retail investors in the crypto space but also raised serious questions about the oversight and vetting processes within the Blast ecosystem.

Impact and response

The aftermath of RiskOnBlast's rug pull reverberated through the Blast ecosystem, sparking intense debate over investor due diligence and the responsibilities of platform endorsements. 

The community's reaction was a mix of outrage and introspection, with one investor lamenting a personal loss of over $12,500. Critics, including influential voices within the cryptocurrency sector, admonished the lack of rigorous due diligence and the hasty investment in projects lacking transparency and proven track records.

CBB0FE (@Cbb0fe):

“Influencers and funds being so greedy about @Blast_L2 ecosystem that they are backing undoxxed founders with no track record in the industry.@riskonblast just rugged 500 ETH. Maybe next time perform some decent DD before putting your names as backers.”

In response, Blast sought to distance itself from the fallout, emphasizing its role as a facilitator rather than a guarantor of project success. Despite this, the incident served as a cautionary tale, highlighting the speculative nature of the crypto market and the need for heightened investor vigilance. Meanwhile, Blast announced the selection of 47 projects from 3,000 applications in its developer competition, signaling a continued commitment to building a secure and vibrant ecosystem.