[{"category":{"name":"BitScreener Exclusive","exported_url":"bitscreener-exclusive"},"id":"006fcda3-2e93-4652-a58c-f59fd8a43fbe","updated_at":"2024-06-19T09:29:01.849+00:00","account":{"firstName":"Mason","lastName":"Thompson"},"description":"Learn about the case of BONKKILLER coin, and what it can teach us about red flags in crypto ventures. ","sapo":"BONKKILLER coin was all the fuzz, that is until it turned out to be a scam. Read on to learn everything there is to know about BONKKILLER and what this scam scheme can teach us about red flags to look out for before investing in crypto projects.","title":"BONKKILLER: Solana Scam Token Teaches Red Flags in Crypto","content":"

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The Case of BONKKILLER

What is BONKKILLER Crypto?

BONKKILLER was a meme coin launched on the Solana blockchain on April 29th. The token's name, "Bonk Killer," grabbed the attention of people already familiar with the viral Solana-based BONK as they searched for investment opportunities in the next contender to surpass the dog-themed memecoin.

bonk price performance

BONK Price Performance

Starting as a little-known meme coin, BONKKILLER rocked the crypto world after surging to a whopping $300 trillion market capitalization despite having fewer than 1,500 holders.

To give it a sense of scale, Bitcoin's market capitalization now stands at roughly $1.3 trillion dollars, while the global GDP is estimated at around $100 trillion. This means BONKKILLER's market cap alone was over 250 times that of Bitcoin and more than three times the value of the entire global economy.

However, if it sounds too good to be true, it probably is. BONKKILLER coin was later flagged as a honeypot scam, as reported by the Solana-focused news outlet SolanaFloor.

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Crypto analytics platform Birdeye’s data revealed that over 90% of BONKKILLER's supply was controlled by its creator, who also implemented a "freeze authority". This function prevented holders from selling their tokens, essentially locking in their investments.

Public Outcry & Aftermath

Despite obvious red flags exposing BONKKILLER’s fraudulent schemes, some investors still continue to purchase the coin, resulting in the scam extracting $1.62 million.

“From an initial supply of 1 $SOL ($140), the developer who created the scam coin BONKKILLER has now pulled out nearly half a million dollars. Retail plebs just keep giving this guy free money.”, commented crypto researcher gnarleyquinn on X.

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The public is growing increasingly concerned about the prevalence of fraudulent projects like BONKKILLER, which often gain traction on social media, making them difficult for beginner investors to identify.

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The prevalence of scam crypto projects like BONKKILLER, combined with the volatile nature of cryptocurrencies, seems to be driving more retail investors away from these digital assets. Latest expert insights point to independent investors' reluctance to further their engagement with crypto products, a trend that may ultimately impact the trajectory of the entire market.

What Are Honeypot Scams?

BONKKILLER is just one of over a dozen honeypot scams that have wreaked havoc in the crypto realm. Honeypot scams are a type of fraudulent scheme that lures unsuspecting victims into investing in seemingly attractive cryptocurrencies, with the ultimate goal of stealing their funds.

Honeypot scams often involve the creation of deceptive smart contracts or tokens that mimic legitimate projects, promising high returns but hiding mechanisms designed to trap investors' assets. BONKKILLER exemplifies this tactic, where an artificially inflated market cap and misleading promises lured investors into purchasing the token, only to be locked in by a malicious smart contract, rendering their investment worthless.

Even those with experience in the crypto space can fall prey to these scams. In May of this year, influencer Eunice Wong, boasting over 100,000 followers on X, faced public scrutiny after crypto detective ZachXBT exposed her promotion of the THADDEUS token, a honeypot scam. Wong's series of endorsement posts, later revealed to be misleading, resulted in significant backlash and a pledge to compensate those affected.

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ZachXBT also reported similar patterns in other Solana-based meme coins. An earlier investigation revealed a list of crypto projects abandoned after accumulating investments through initial hype, totaling a loss of $26.7 million.

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Lesson Learned: How to Avoid Falling Victim to Honeypot Scams

Given the prevalence of crypto scams like BONKKILLER, it is crucial for investors to arm themselves with knowledge and strategies to identify and safeguard against these threats.

How to Detect and Avoid Honeypot Scams

Check the project team’s credibility and presence: See if the project is transparent in sharing information on their team members, and whether they maintain an established and active online presence.
Check the project’s whitepaper: Carefully analyze the project's whitepaper for well-defined, comprehensive, and achievable goals, as well as a thorough explanation of technical aspects.
Consult community opinions and reviews: Look for signs of organic engagement and discussions, as well as independent reviews from sources outside the project's official channels.
Analyze the project’s smart contract: Verify the on-chain smart contract's credibility by looking for audit reports from reputable firms and confirming whether the project utilizes open-source code.
Make small initial investment: If you're unsure of the project’s credibility but afraid to miss out, start with a small investment to test the waters.
Use Reputable Platforms: Stick to well-known and reputable exchanges and investment platforms for your transactions.

Red Flags to Look Out For

Promises of unrealistic returns: Be wary of promises of exceptionally high returns with little to no risk. If an investment opportunity seems too good to be true, it probably is.
Lack of transparency: Be cautious of projects that are vague or secretive of their team’s information and the coins’ details.
Poor online presence: Reputable projects invest in professional websites and communications, so if you spot poor web design or unprofessional communication, it's probably best to steer clear.
Pressure tactics: Scammers often use high-pressure sales tactics to force investors into FOMO (Fear of Missing Out), thus urging quick and uninformed investments.

You Fell For a Scam. Now What?

What if you fell for a scam and it's already too late? In a honeypot scam, once you're trapped, chances are you won't get your money back. However, there are still preventative measures you can take to lessen the impact:

Report the scam: Notify the platform where you encountered the scam and provide them with all relevant details to track the scammers down.
Consult legal advice: Seek legal counsel from a lawyer specializing in cryptocurrency and financial fraud to explore potential options for recourse.
Warn Others: Share your experience with the crypto community through online forums, social media, and other channels to raise awareness and protect others from falling victim to the same scam. In the BONKKILLER case, investors' reports of being unable to sell their tokens quickly alerted the community to the coin's fraudulent nature, preventing many others from falling victim to the scam.

Bear in mind that the cryptocurrency market is in its nascent stages, and the regulatory framework surrounding it is still evolving. This combination makes it a fertile breeding ground for unscrupulous individuals seeking to exploit vulnerable investors. Therefore, maintaining heightened vigilance and staying well-informed about the latest trends, developments, and common scams within the crypto space is imperative to safeguard your hard-earned investments and protect yourself from potential financial losses.

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BONKKILLER: Solana Scam Token Teaches Red Flags in Crypto

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