The crypto community (r/CryptoCurrency), which started raising its voice on Reddit, is reacting to the Algorand CTO getting in touch with a known scam phenomenon. The person concerned, Bitboy, was sued by the Loevy & Loevy law firm last week for market manipulation.
Algorand CTO working with BitBoy
Ben.eth and Bitboy have marketed two projects, BEN and PSYOP, following the meme token bull that started with PEPE in April. In particular, it turned out that Ben.eth increased its wallet balance with these tokens from $ 2,600 on May 3 to $ 9.28 million on May 23. The duo previously played an active role in BEN token’s 110x rally. Blockchain security firm PeckShield included these tokens on the rug pull list in a recent report.
The development that Algorand has garnered backlash is when a writer from BitBoy Crypto appears with the Algorand CTO. BitBoy Crypto writer @Ajwritescrypto with 11.4k followers shared on Twitter yesterday that he had spoken to the Algorand CTO and said, “Something big is coming for ALGO.”
Something BIG is coming for the #Algofam! I just got off the phone with @JohnAlanWoods and cleared the idea with @Bitboy_Crypto. There will be a video tomorrow morning explaining all of this.
Let's not complain about hype, LET'S CREATE IT! @CassiusCuvee #ALGO— Aj (@Ajwritescrypto) June 2, 2023
The tweet said that the big news would come out this morning. However, the Reddit community is reacting to this news. Many claimed that the Algorand CTO was unaware that BitBoy was a scam. BitBoy, BEN and PSYOP have gained notoriety among the crypto community with their recent strides.
SEC steps in
The US regulator SEC is keeping a close eye on crypto phenomena that support scam projects and have been found to manipulate the prices of certain tokens via social media. Former SEC chairman John Reed Stark warned on Twitter that phenoms should be ready for lawsuits.
In his tweet, Stark addressed crypto influencers on social media who downplay numerous sketchy crypto projects and often help them manipulate market prices during a bull run. He warned that the same anti-fraud rules apply to any form of price manipulation and that the days of social media crypto influencers are numbered.
Attention all crypto promoters who use social media to manipulate the price of crypto-securities: Fail not at your peril. Not only will you eventually get caught, but your prosecution will also be like shooting fish in a barrel.
Whether manipulating the price of exchange… pic.twitter.com/AfKROIlR0N
— John Reed Stark (@JohnReedStark) May 30, 2023
The former SEC chair highlights the brash and arrogant way many phenoms defraud their victims. Most price manipulation happens via social media platforms like Twitter, Discord, Instagram or Reddit. Unlike other forms of scams, Stark says they can spot them quickly:
Regulators and law enforcement only need to turn on their computers to discover the extraordinary and dazzling evidential trail of convincing and vivid incriminating evidence. Indeed, social media has become a virtual thread that many cryptocurrency bros (and sisters) use to hang themselves, far from tying up the government.
This phenomenon raised $1 million by doing nothing
Aside from the social media pump groups highlighted by John Reed Stark, today a phenomenon called Pauly0x has proven how easy it is to raise money from the community. Pauly0x shared a wallet address in his Twitter post. However, he said that he would not distribute anything even though money was sent. Despite this, the phenomenon with 76.7 thousand followers collected ETH worth $ 1.3 million in his wallet.
Send ETH here:
0x8DFD4f307B6011D4CB21007FD5658f0686523938 pic.twitter.com/edG01OTY5i
— PAULY (@Pauly0x) May 30, 2023
Finally, the meme projects in PeckShield’s recent report that were found to do rug pull are as follows:
- SHITME
- BENS
- WorldCoin
- MONKEYS
- ERDR
- magneto
- STARK
- PERSON
- LADYBOY
- USACOIN
- WLD
- POGO
- miniclip
- PORN
- FROGS
- RNDT
- PSYOP
- POPCAP
- FOG
- TEMU
- TINDER
- TAGGED
- SEI
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