DappBay Rings Alarm as Project Misleads Users

DappBay has already begun to make an impact after effectively citing an imminent risk just days after going live.

Shortly after DappBay launched the Red Alarm function, the "Day of Rights DAO" project misled users in an attempt to misuse funds. In this piece the team outlines the diligent work that goes into identifying risk and just how quickly some of these bad actors move. Shedding light on this process underlines DappBay's broader aim, to help the BNB Chain community protect their assets and stay SAFU!

On DappBay, Red Alarm regularly displays high-risk projects on the BNB Chain to warn innocent users. Using Red Alarm, we can learn the specifics behind each project’s risk rating. This service relies on BNB Chain's strong technical team and powerful data analysis capabilities. You can learn more about DappBay in our introductory blog.

DappBay in Action

Next, let's review how the "Day of Rights DAO" project proceeded to swindle users:

Overview

On July 9, 2022, the Day of Rights project perpetuated a soft rug pull with its $AMO token. In total, more than 100k tokens were sold, equivalent to slightly more than $1 million gained. Essentially, the $AMO deployer minted 10 million tokens to a wallet and subsequently sent 520k tokens to a second wallet. The second wallet proceeded to dump tokens resulting in a price drop of ~63%.

Ref: https://twitter.com/certikalert/status/1545730725680500736?s=21&t=yC8bH5xXBzoSovMbcVTPhw

Background:

According to the Day of Rights DAO’s whitepaper, there are 3 main tokens in its ecosystem:
(1) $DOR token: the main token

(2) $AMO token: Dorswap currency

(3) $BIN token: Dorswap currency

For this incident analysis, only the $AMO token is observed and investigated.

Addresses involved:

AMO Token ($AMO): 0x7a349cccbb341d57e274c298f1e4751fb33158e5

$AMO Deployer: 0x6aebde28f25647bd61087e8020b9ca0eb10e0529

$AMO Supply Wallet: 0x49aa9c715e8df5920b51a224cddad62aac1af966

$AMO Dumping Wallet: 0x8113f0d4412b0399b1ec3bc7ba2a096e91f6fd8c

$AMO-$USDT LP: 0x2126771205c34e273e53d3d8af50e1daa17fbe9d

$DOR-$USDT LP: 0x31ea275ca9ed412f80ebc8b7ac705ece5f263cb0

Incident Timeline: (Time shown here in +UTC)

4 July 2022 06:00:00

DappBay launched Red Alarm and published a list of 27 high-risk projects on BSC network, including “Day of Rights DAO”.

In particular, DappBay issued this risk warning against “Day of Rights DAO”:

The contract contains logical or programming backdoors that are able to drain users’ funds. The contract owner / deployer may perform rugpulls by calling privileged functions, dumping their tokens or migrating the contract. It is not recommended to invest in a rugpull contract since all of the funds can be lost.

4 July 2022 11:44:06 - 14:20:52  

$AMO Deployer minted 10 million $AMO tokens to the $AMO Supply Wallet.

Transaction: https://bscscan.com/tx/0xae87a0425f1c28bfe41a7e517cb570d4e336e162a487c5060bab517b014440a6

The $AMO Supply Wallet then transferred 520k tokens to the $AMO Dumping Wallet.

Transactions:

• https://bscscan.com/tx/0x108d8572d0d93236e1317e61fc3172cd22c8907886b30f9bcaa909018328ab6e
• https://bscscan.com/tx/0x908c79808094af413d526f2778140b73a6a2d3e3c6c3d9d9adcc07a665cf4b23

9 July 2022 10:50:36 - 11:24:48

The $AMO Dumping Wallet sold more than $100k $AMO tokens, for $USDT tokens, using the $AMO-$USDT LP.

12 July 2022 03:00 (Time of writing)

The $USDT funds have now mainly been transferred out (red box) or used to repurchase $AMO tokens in $AMO-$USDT LP 1 to artificially inflate its price (green boxes).

100k $USDT tokens still remain in the $AMO Dumping Wallet.

The $USDT funds were transferred out to other burner wallets where they were used to buy $DOR tokens (main token) in a separate LP: $DOR-$USDT.

Example screenshot of one of the wallets:

Analysis

1. The $AMO token smart contract is unverified, i.e. closed source, which usually signifies high risk since there is no transparency.
2. Currently 89.5% of the token supply is controlled by the $AMO Supply Wallet.
3. The burner wallets were used to artificially inflate the price of the $DOR token, and will buy the tokens at roughly the same time range to increase the buying pressure, to attract unknowing investors.
4. All of the $USDT funds have been used to repurchase $AMO or $DOR tokens. This can signify that the project party is not quite done just yet.

Summary

DappBay mainly relies on significant amounts of data and deep experience in its risk analysis. As a result, we have consolidated many risk elements. It is absolutely essential for users to understand projects’ risks and their traits. Based on the risk rating given by DappBay, the key risk characteristics of "Day of Rights DAO" are:

1. High centralization risk

2. Unverified contracts

3. Artificial manipulating of token price

To learn more about risk projects and protect your assets, please check out DappBay's Red Alarm module.

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