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This Token Tanks 90% in Suspected $35 Million Rug Pull

2 mins
Updated by Ali M.
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In Brief

  • SHIDO token prices plunge 90%, suspect $35 million rug pull after contract exploit.
  • Amid rug pull fears, Shido announces refunds for the users who staked tokens.
  • This week, SenecaUSD and Serenity Shield were also hit by security breaches.
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The prices of SHIDO tokens nosedived nearly 90%, shedding light on a suspected $35 million rug pull. This dramatic decline unfolded in just half an hour, sending shockwaves through the crypto market.

This incident is not the only security breach this week. Other projects, such as SenecaUSD and Serenity Shield, have also fallen victim to the foul play of bad actors.

Why Community Fears Shido Rug Pull?

At the heart of this debacle is the Layer-1 blockchain Shido, which aimed to pioneer proof-of-stake technology. However, its ambitions were compromised due to a severe exploit on its Ethereum-based staking contract.

“The new owner promptly upgraded the StakingV4Proxy contract by incorporating a hidden withdrawToken() function, enabling them to withdraw the balance of 4.3 billion $SHIDO tokens,” blockchain security firm Cyvers explained.

This theft effectively wiped out nearly half of Shido’s circulating supply, which, before the incident, was valued at approximately $35 million.

Read more: Crypto Project Security: A Guide to Early Threat Detection

Shido Price Performance
Shido Price Performance. Source: BeInCrypto

The scale of this theft has ignited widespread speculation among the community, with many fearing an orchestrated exit scam. Concerns were raised notably by X user Gerry Smart, who criticized the project owner’s abrupt contract changes.

Furthermore, Shido’s team is under fire for allegedly muting discussions on their Telegram channel, exacerbating the trust deficit among investors. This incident looms over Shido’s anticipated mainnet launch, scheduled for the upcoming week.

“Since the owner of the project had upgraded the contract and subsequently withdrew a large number of SHIDO tokens, and blocked people asking about this, I don’t believe in this project,” Smart said.

Amidst rug pull allegations, the Shido team has announced a refund for the users who staked their tokens. Moreover, the team declared that it is thoroughly investigating the security incident.

This unfortunate event is not an isolated occurrence in the crypto ecosystem. SenecaUSD fell victim to an exploit a day earlier, resulting in a $6.4 million asset loss.

“The SenecaUSD incident was caused by a critical vulnerability in the `performOperation` function, which allows the attacker to specify the action to be OPERATION_CALL. When executing through the call function, the attacker can perform external calls to any address as the callee and callData are fully controlled by the attacker,” blockchain security firm CertiK told BeInCrypto.

Read more: What Is a Rug Pull? A Guide to the Web3 Scam

Similarly, Serenity Shield, known for its secure data storage solutions, saw its token value plummet following a security breach. Serenity Shield’s immediate response to the theft of 6.9 million SERSH tokens, valued at $5.6 million, was to freeze all trading, deposits, and withdrawals. The team pledged to issue a new token to protect community interests and promised 1:1 compensation for affected SERSH holders.

As the dust settles, these incidents underscore the volatile nature of the crypto market and the critical need for robust security frameworks.

Top crypto projects in the US | April 2024

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Harsh Notariya
Harsh Notariya excels in delivering SEO-optimized crypto news under tight deadlines. Previously, as a Growth Marketer at Sporty and a Community Consultant at Totality Corp, he significantly boosted community engagement and followers. Harsh also crafted engaging content for top crypto influencer Shivam Chhuneja, blending meme references for an educational yet fun experience. His versatile skills make him a notable figure in crypto journalism.
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