Coinbase’s In-Home Blockchain Launch Adopted By Impersonation Tokens

Coinbase launched its personal Layer-2 blockchain yesterday, inbuilt collaboration with Optimism in its OP stack.

The brand new Layer-2 blockchain, named Base, will host a lot of Coinbase’s on-chain merchandise and supply EVMs at low prices to builders.

Piggybacking on Latest Information

Sadly, opportunistic unhealthy actors are as soon as once more attempting to make a fast buck off of the success of different companies. Not even a day after Base was launched, Solidus Labs introduced through their Token Sniffer web site that no less than 4 new tokens had been recognized, all with names taking part in on Coinbase’s new product, akin to Base Token and even the very generically named “Coin Chain.”

🚨SCAM ALERT: Since @coinbase‘s testnet launch of @BuildOnBase, 4 impersonation tokens have been created to capitalize on the hype surrounding the Layer 2 community.

The tokens’ particulars: pic.twitter.com/LnQJfMCoZw

— TokenSniffer.com (@Token_Sniffer) February 23, 2023

These tokens try to offer off an air of legitimacy, hoping to lure gullible customers into shopping for their tokens earlier than realizing that they don’t have anything to do with Coinbase. Sadly, there may be a good greater situation at play: in line with Token Sniffer, 3 of the 4 tokens in query seem like honeypots.

Within the crypto world, a honeypot is a brilliant contract that doesn’t permit anybody however the contract creator to withdraw funds as soon as they’re deposited within the pockets, which means that even when a person realized that they had been scammed, they may not do a lot about it.

Considered one of these tokens, BASE, spiked by 250%, in line with Coinmarketcap, reaching the worth of $7.05 – bringing the coin’s market capitalization to roughly $1 million – earlier than crashing again right down to about $2 on the time this text was written.

Moreover, Coinbase has said that they haven’t any intention of releasing any token affiliated with this new blockchain – so any additional tokens of this kind might be dismissed as a fraud out of hand.

Market Immaturity

Sadly, new tokens making an attempt to money in on market hype have been made repeatedly, revealing a sure market immaturity within the crypto sphere, in accordance to Bloomberg.

In response to Darius Tabatabai, the founding father of the Vertex Protocol DEX, customers who purchase these tokens are both misled by the title or are merely falling for fraud.

“Cash being minted on the premise that they sound like a considerable venture however are solely making the most of a information cycle is an indication of lingering immaturity in digital property. Anybody shopping for these is both making a mistake with a protocol that does one thing completely totally different or is simply falling for a deliberate fraud.”

Scams just like the notorious Squid Sport Token are probably the most brazen, however the more moderen examples of AI-centric tokens making an attempt to capitalize off of the latest rise in curiosity in AI additionally come to thoughts. These points are additional exacerbated by bots shopping for up new tokens on the spot, as infamous prankster Avraham Eisenberg demonstrated.