Disclosure of YFII bifurcation project YYFI fraud: five days to complete the layout, crazy secondary after the collapse of arbitrage leaving

Thanks for the help and guidance of Mai Purse Lu Yuyuan to this article.

Rhythm BlockBeats news, since the launch of the liquidity mining, YFI no pre-mining method can be said to be the liquidity mining to a climax phase. YFII, then a hard fork, set off the bifurcation trend. But as the craze has grown, so too have the "scams". The projects YYFI and YFFI derived from YFI are two typical cases. In this article, I take a look back at how these two BlockBeats were planned and implemented. I hope you'll be on your guard.

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YFII's hard bifurcated project YYFI has completely become "exit scam" in the early morning of August 1, while its complete operation mode can also be seen. From the very beginning, this project seems to have decided to pay attention to get ready for its own run.

According to the Ethereum browser, the contract for YYFI was created on July 27 and branched from YFII. The project was first deployed in Balancer and Uniswap, and then, unlike YFI and YFII, the YYFI team had pre-dug, which meant that some of the YYFI tokens were already in the team's hands before other users got involved.

Then the project team (or individual) behind the scenes to create various social channels, including the telegraph (Telegram) and Discord, and these are the standard of a project, this project can be said to have already completed the preparation work, finally in order to let the user trust, team also said in social channels will be destroyed within 24 hours of the private Key management (Admin Key), in order to ensure not to raise or extracting tokens. However, the private key is destroyed until the end of the project.

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Subsequently, it began to attract users to join in the liquidity mining. As it caught up with the two hot spots of liquidity mining and YFII, the liquid capital pool of YYFI was about $500,000 - $600,000 in the morning of July 31, and directly reached $1.5 million in the evening. While the price of YYFI was hovering around 200-400, while the daily yield rate of YYFI was quite high at that time, the Pool 2 was about 50%, and the Pool 1 Pool was roughly 10-20%. High yield often means high risk.

Pool 1, now flagged as a fraudulent contract address

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On July 31, YYFI said the team would destroy the private key at 3am on August 1. However, around 2am to 3am on August 1, the price of YYFI currency began to plunge. The team used the previously pre-dug YYFI token in Balancer to smash the deal. The price of YYFI tokens dropped directly from over $200 to $30 in Balancer, eventually closing near $2. During this period, in order to complete the cash out of the Pool, the team used the private key to increase a huge amount of YYFI and drained the Pool 2 funds.

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After this series of operations, the team immediately disbands the various communities and disappears. The trick is done.

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Then the whole process is actually very simple, which can be summarized as follows:

1. Set up a contract that can rub against the hot spot and begin to pre-dig the liquidity mining token issued by myself;

Build up various social channels (Telegram, Discord, maybe even WeChat);

3. Attract users to participate with high yields, create the illusion of arbitrarily-able currency price increase, and continue to give confidence to the community;

4. Finally, the pre-dug token is used to smash the plate, and in the case that it cannot be smashed down, even unlimited issuance leads to the plunge of the token;

5. Arbitrage position, disband the community and disappear completely.

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In fact, many users can still be fooled by the seemingly simple scam. In the temptation of high interest rates, sometimes they can't help but put money into it even when they know the risks.

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Although the team is on the move, the smart contract is still in place, and users with money in the contract can also come forward. The tutorial is as follows:

1. Check your BPT balance in the contract
https://etherscan.io/address/0x2BcA419E570B1620B5e922Fc005e806453aFFc83#readContract 

2. Then withdraw BPT and remove your liquidity

https://pools.balancer.exchange/#/pool/0x99D9DF67196190E9F12eaC7414f02E62C5bf9eAB

This was the end of YYFI, but it became the beginning of the "YFI series" projects. YFFI. Finance (YFFI), a reproduction of YFI, burst onto the scene immediately after YYFI was gone.

So far, the operation of this project is very similar to YYFI:

1. Existence of pre-excavation;

2. Unreasonable yield at high age (9217%);

A slight difference, though, is that with $17 million under the YFFI contract, it is doubtful that a project so young could have so much money. Other teams have used their own cash infusions to get users involved before, and the project is likely to use the same approach. YFFI announced on Twitter today that it had destroyed the management key, meaning there may not be a huge followup like YYFI, which has already run its course. But it is not clear whether the project has other minting rights, and there is still the possibility of a team crashing the tokens that were previously dug up.

In the face of the illiquid mining boom triggered by the YFI project, many scams are using high yields as a gimp to attract users, who typically lose more than half their principal once they are involved in such projects.

In this rhythmical BlockBeats, users are reminded to pay attention to the following points when participating in liquidity mining:

1. I need to ensure that I fully understand the project mechanism and risks

2. Be familiar with the contract operation and get to know the project team (run-away projects are usually not shown to the real person, but it does not mean that the project with team information is safe)

3. & have spent If an exception is found, the token will be transferred in a timely manner (change address), the cancellation of authorization is not fully able to cover all authorization contracts.

Rhythmical BlockBeats again reminds readers to be careful about identifying information when investing in cryptocurrencies or participating in DeFi. Do not generate Fomo psychology in case of asset loss.

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