The hunt begins at Pepe. Last May, the memecoin Pepe the Frog (PEPE) has taken the ecosystem by storm crypto. While some saw it as the new figurehead of memecoins, the project is now facing rug pull rumors.
Suspicious transfers at Pepe and rumors of a pullover
On Thursday August 24, a series of transactions from Pepe the Frog’s multi-signature wallet was detected. A total of 16,000 billion PEPE tokens, or around 16 million dollarswere moved to several exchange platforms, including OKX, Binance, Kucoin and ByBit.
However, no announcement has been made by the project. As a result, rumors of a rug pull are starting to gain momentum. As a reminder, a rug pull is a cryptocurrency scam where developers suddenly sell their tokens. This causes the price to fall drastically, leaving investors with devalued assets.
Internet users soon discover that the multi-signature wallet rules of the project have been changed1 h before the transfer. Instead of the required five out of eight signatures, the threshold has been reduced to 2/8. As a reminder, a multi-signature wallet requires the signature of several parties to validate a transaction.
For its part, the PEPE course also reacted downwards, recording a 15% drop.
Rug pull confirmed by Pepe project
Finally, after two days of radio silence, the X account (formerly Twitter) of the project has published a clarification of the situation on August 26. In it, we learn the real story behind the PEPE token and the mysterious movement of funds.
We learn that three members of the project are behind of the transactions carried out. The message writer reveals that PEPE has always been « plagued by internal conflicts »..
The project would have consisted of « bad actors driven by excessive egos and greed ».. They frequently blocked the project’s progress. After having distanced themselves from the project, these former members returned on August 24 to steal the 16,000 billion PEPE tokens on the multi-sig wallet.
Subsequently, they withdrew from the multi-sig in order to blur their link with Pepe. They also deleted all their social network accounts. All they left behind was a message to the remaining members of the project: « the multi-sig has been updated, you now have full control »..
Remaining funds should be transferred to a new multi-sig wallet.
From now on, the member behind the message says he is relieved to be able to operate the project under better conditions. However, this in no way solves the problem of the $16 million resold on public markets.
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The hunt is on for stolen funds
As is often the case, after a crypto theft, the Web 3 investigators set about tracking our hackers’ every move.
For example, the Internet user Jeremy « Pauly » Cahena fervent promoter of PEPE, began reveal details on the identity of certain members and their on-chain activities. According to him, the project teams have between $16 and $17 million in PEPE tokens. These are spread across nine different wallets, used for inside trading.
« The PEPE team holds 16-17 million PEPEs across at least nine different insider wallets. Why haven’t they sold from these? Because by getting rid of the CEX portfolio, they knew they could create a massive short position, then get rid of the market and print. »
Jeremy « Pauly » Cahen
Now Pauly intends to make the PEPE members pay, and has said he will do all he can to help law enforcement apprehend the culprits.
Recently, another rug pullover had also shaken the community. The mysterious developer of the BALD on Base took off with the funds. There was even speculation thatit could be Sam Bankman-Fried himself.
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