Hot List: ERC-404 project exposed for involvement in Rug pull, is the founder of the security company also here to harvest the leeks?

Author: shushu, BlockBeats

In a bull market, it's important not only to guard against spikes but also to identify rug pull habitual offenders.

This morning, the 404 project ERROR, which ranked sixth on the hot list, surged to $13,629 before starting to plummet. As of the time of writing, the price has dropped tenfold to below $1,350.

Launched and Immediately Exposed

ERROR is an ERC-404 token deployed by Serpent. On March 1, Serpent announced the deployment details of ERROR on social media, stating that there are only 404 tokens in total. This morning, Serpent tweeted that ERROR had gone live, but just two hours after the launch, it was deeply investigated by on-chain detectives, who labeled it a scam.

Currently, ERROR's official Twitter has been shut down. Let's take a look at how on-chain detectives uncovered this scam.

At 7:59 AM, half an hour after ERROR went live, Twitter user ManaMoon (@ManaMoonNFT) tweeted that ERROR's fake contract had already gone live with the same checksum and unique functions hours before the "real" contract was deployed.

Then, on-chain detective ZachXBT tweeted at 8:47 AM that the deployer of ERROR injected $1.3 million into Ethereum through Stake, and this money was previously obtained from a rug-pulled FCKIT meme coin presale initiated by someone named Eskyy.

From the funding chain shown above, we can see that the FCKIT meme coin deployment address transferred 200 ETH to an address starting with 0xccb9, and this money ultimately flowed to the ERROR deployment address.

FCKIT went live at the end of May 2023, but the project's founder's Twitter account has been deactivated, and FCKIT cannot be found.

Rug Pull Habitual Offender Was Once a Security Company Founder

Interestingly, ERROR's deployer Serpent was previously the founder of a security company. His previous titles included founder of Discord and the crypto threat mitigation system Sentinel, and co-founder of DAPE, where he used to expose hacking incidents and scam alerts on social media.

On February 25, Serpent posted a pre-launch tweet for ERROR saying "Turn on tweet notifications." In a previous post, Serpent retweeted a scam case he exposed in 2022—"Analyzing how scammers stole 14 BAYC through a month-long social engineering scam, worth over 852 ETH." It must be said that Serpent also understands social engineering.

During Serpent's management of Sentinel, he was also involved in a deception controversy. When a user questioned how to communicate with real hackers, Serpent was promoting his security products. Currently, the Sentinel Twitter account has been deactivated.

Although we cannot determine if Serpent is the same person as Eskyy who deployed FCKIT based on the Twitter account, it is interesting that Serpent also posted a tweet before FCKIT went live saying "Leave your wallet address, you will thank me."

As the bull market arrives, I remind everyone to be cautious and identify risks when participating in various new projects; going all-in is not wisdom, but going all-in on safe projects is a form of wisdom.