A staggering 91% of meme coins on Coinbase’s Base platform have been found to have security vulnerabilities, putting users at risk of significant losses.
This comes after the Dencun upgrade, which has seen a surge in user numbers, transactions, and total value locked on Base. It resembles the activity fueled by degenerate gambling on Solana’s L1 blockchain.
Coinbase’s Base Meme Coins Suspected of Scam
A new study analyzed 1,000 new Base tokens, primarily meme coins, launched between March 19 and March 25. The analysis revealed that 908 projects failed to meet one or more fundamental security measures. These include locked liquidity, verified contracts, and the absence of honeypots.
This lack of security could stem from creators’ ignorance about proper procedures or an attempt to troll the industry.
David Schwed, COO at Halborn, highlighted the challenge for projects lacking resources to hire security experts or conduct independent assessments. Many projects exacerbate the situation further by copying existing tokens, thus perpetuating flaws.
“The tendency of these projects to be forks of existing projects or generated through AI means they often inherit vulnerabilities or introduce new ones.” Schwed said.
More importantly, conditions such as exaggerated sales “taxes” have led to suspicions that 17% of the meme coins on Base are outright scams. While not all projects with extreme marketing campaigns are scams, it raises concerns about their legitimacy.
Read more: 7 Best Base Chain Meme Coins to Watch in 2024
The meme coin craze continues to divide the industry. Some have criticized the lack of utility and high scam rates, while others see meme coins as a way to onboard new investors into the space.
For instance, Ethereum’s co-founder Vitalik Buterin views the playful nature of meme coins as a potential avenue for beneficial outcomes. He highlighted instances where charity coins have supported anti-aging research and cultural endeavors, showcasing how meme coins can contribute to significant causes.
“I value people’s desire to have fun, and I would rather the crypto space somehow swim with this current rather than against it. And so I want to see higher quality fun projects that contribute positively to the ecosystem and the world around them (and not just by “bringing in users”) get more mindshare,” Buterin wrote.
Read more: 7 Hot Meme Coins and Altcoins that are Trending in 2024
As the meme coin phenomenon grows, the importance of real value, security measures, and investor vigilance becomes increasingly clear.
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