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Encryption AI Token Plummets 99% As Developer Rug Pulls $2M for Gambling Addiction

2 mins
Updated by Kyle Baird
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In Brief

  • Encryption AI (0XENCRYPT) crashed by 99%, losing $2M due to a rug pull executed by the developer with an online gambling addiction.
  • Developer's message revealed severe online gambling addiction, with losses of nearly $300,000 in the past two months.
  • The rug pull incident adds to the list of projects using AI to lure investors, with no guarantee of project relaunch.
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A crypto project called Encryption AI has experienced a rug pull. The developer has stolen about $2 million and users are unlikely to obtain recompense.

Crypto project Encryption AI (0XENCRYPT) has crashed by 99% as the developer behind it executed a rug pull. The total sum lost is $2 million, and the developer posted a message referring to his online gambling addiction.

Rug pulls are one of the notorious scams plaguing the crypto market. Check out our deep dive on this type of scams to learn how you can safeguard yourself from such fraudulent schemes: What Is a Rug Pull? A Guide to the Web3 Scam

Encryption AI Crashes From $2M Marketcap to $20,000

Several reports have emerged on social media relating to the rug pull. This includes a message from the developer himself, who stated that he had “fallen into a severe addiction to online gambling and casinos.” He said that he had lost nearly $300,000 in the last two months. He went on to say that cannot guarantee if and when he can make amends and relaunch the project.

Message from Encryption AI Developer. Source: Twitter/Bulla
Message from Encryption AI Developer. Source: Twitter/Bulla

There is little information about the developer. The project claimed to offer a secure and efficient way to launch new tokens, with different bots helping users find and assess token launches.

Price of 0XENCRYPT. Source: BeInCrypto
Price of 0XENCRYPT. Source: BeInCrypto

The price of the 0XENCRYPT token has fallen from $2.06 to $0.02. It’s unlikely that the token will recover or that the project will relaunch. The incidents add to the growing list of projects utilizing AI as a means to lure investors.

TOOLS Token Another Victim

The rug pull of Encryption AI happened alongside the rug pull of TOOLS. The latter is a BSC-based DeFi dashboard that claims to supercharge trading experiences on BSC. There was no verification of the developer’s identities, which is usually a pretty solid sign of risk.

TOOLS Price. Source: DEX Screener
TOOLS Price. Source: DEX Screener

The token is currently priced at $0.00006, down from $0.006 at the start of July. As is the case with Encryption AI, there isn’t much information available so far, but the crypto community is in a furor over another rug pull.

Several Rug Pulls Already in 2023

Rug pulls and hacks have plagued the crypto market in 2023, with numerous incidents taking place this year. It’s a rough start for the market, though, in general, several measures have been put in place. This has led to a slowing down of bad actors in 2023.

Morgan DF Fintoch executed one of the biggest rug pulls this year, stealing $32 million. It claimed to be backed by Morgan Stanley. More recently, Chibi finance users lost over $1 million after developers rug pulled,

Such incidents have led to the U.S. Commodity Futures Trading Commission (CFTC) warning users about hacking. CFTC Commissioner Christy Goldsmith Romero said that hackers were more coordinated and innovative in 2023.

Top crypto platforms in the US | February 2024

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Rahul Nambiampurath
Rahul Nambiampurath's cryptocurrency journey first began in 2014 when he stumbled upon Satoshi's Bitcoin whitepaper. With a bachelor's degree in Commerce and an MBA in Finance from Sikkim Manipal University, he was among the few that first recognized the sheer untapped potential of decentralized technologies. Since then, he has helped DeFi platforms like Balancer and Sidus Heroes — a web3 metaverse — as well as CEXs like Bitso (Mexico's biggest) and Overbit to reach new heights with his...
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