In the world of cryptocurrency, the emergence of altcoins is not uncommon. These altcoins usually use the excuse of popular projects in the market to try to attract investors' attention and gain benefits. However, they often lack real technology or viable business models, and their purpose is to deceive and defraud investors' funds. Recently, riding on the popularity of Grok xAI launched by Musk, a project called GROK has seen its token price rise wildly since it launched its token on November 4. On November 13, on-chain analyst ZachXBT tweeted that the project was a scam because its project Twitter account had been used by different scam projects. Subsequently, the price of its token fell by more than 50%.
https://eagleeye.space/detail/grok
Identifying and avoiding altcoin traps requires investors to remain vigilant and conduct adequate due diligence. Today, we will teach you how to identify similar scam traps through Beosin's EagleEye platform, and use Beosin KYT anti-money laundering platform to analyze the flow of funds to addresses related to GROK token transactions.
How GROK altcoin attracts user participation
1. Leverage on hotspots and network effects
As a well-known entrepreneur, any project launched by Musk will attract the attention of the media and social media. The GROK project cleverly uses Musk's reputation and influence to associate itself with his project to attract more attention and investment. As a first step, GROK has attracted the attention of many crypto users on social media platforms with the help of AI concepts and Musk's newly launched Grok xAI.
The GROK project claims that it is a "meme" project, making people believe that participating in transactions in the project will bring high returns. This propaganda method can stimulate people's interest and speculation, causing them to trade blindly without sufficient research and analysis.
2. Low liquidity pulls the market
By querying the on-chain information of the GROK token deployer, we can find that the deployer initially only deployed a trading pool of 5.016 billion GROKs and 1 ETH on Uniswap V2:
Transaction hash: https://etherscan.io/tx/0xeb5bacee0076e37e8da26214c68c6610416d49f9bda50949462b00f0dfaac1da
Then, within 1 minute after the opening, multiple risky addresses purchased a large number of GROK tokens. Address 1: 0x1cC121404730515a7Ab84EB1252704dAD4b93774 Transaction hash: https://etherscan.io/tx/0x48d5d48f2c28dc4235eea30ecf8f0f2b0a2a723498438a5602294df64a2a47bf This address purchased 101,111,968 GROK within 35 seconds after the opening, currently worth $1,005,744. We used the Beosin KYT anti-money laundering analysis platform to find that the funds of this address came from previous fraud projects and gambling platforms, and it is a risky address.
Beosin KYT Anti-Money Laundering Analysis Platform Address 2: 0x9d898899d5136763d26cef393451b0296e28359f Transaction hash: https://etherscan.io/tx/0xd31f599b65633982823c729a0920e47f3dde563abcc1aac9b961ff8e67ecb689 This address also purchased 138,000,000 GROKs 35 seconds after the opening, currently worth $1,371,173. Using the Beosin KYT Anti-Money Laundering Analysis Platform, it can be found that the funds of this address come from gambling platforms, with a large amount of funds transferred, and it is a risky address.
Beosin KYT Anti-Money Laundering Analysis Platform Other risky addresses that made large purchases within 2 minutes of GROK opening: 0xa773520d856e640d12f9aa0cfcefe944a14bdead0xd2d53711910812d71b35fc72a45f71a95e5522b80x6a9c69aa3b6c373945fb37e795c6a5fdd4fcbe54
0xd2d53711910812d71b35fc72a45f71a95e5522b8
How users can identify scams
To prevent becoming a victim of a copycat scam, users and investors should be cautious when choosing investment projects. Users should investigate the background and development team of the project, assess the risks and potential returns of the project, and use reliable information sources to evaluate the security of the project.
1. Query project relationships
Taking GROK as an example, EagleEye will analyze the project relationship and show that GROK and Dione Protocol have the same whales, as shown in the figure below.
https://eagleeye.space/relation/grok Looking at the operations of this whale (0x5ED639EB11D3936828bC2F615cBc46102225aC6b), we can find that it has been accumulating GROK tokens since November 4th and currently holds more than 1% of GROK tokens.
2. Query key address risks
After users lock relevant addresses through project relationships, they can use EagleEye to conduct risk queries on relevant addresses. Taking the above-mentioned whale as an example, this address has had financial transactions with black addresses.
Black addresses are generally mixer addresses and addresses marked as scams/phishing. If the relevant addresses of a project involve black addresses, users should interact with them with caution.
3. Follow credible resources and the latest information
Check whether the project has an audit report, whether the team is public, and whether the project information is detailed. Pay attention to community and social media trends to update the rating of the project's reliability and security in a timely manner. The lack of transparency in the project is a warning sign, and investors should ask for detailed information and ensure that the project party can provide clear answers.
GROK No-Code Audit
4. Is there any pretense of popular projects?
Altcoins often try to associate themselves with popular projects in the market to attract investors' attention. They may use similar names, logos, or slogans to create associations with well-known projects. However, such associations may be false, and investors need to carefully verify the authenticity of the project.
5. Be wary of social media propaganda
Altcoin projects may be heavily promoted through social media platforms in an attempt to create hype and arouse investor interest. However, investors need to remain calm and not be fooled by the hype, but make decisions based on actual research and investigation.
In summary, scams are always changing, so it is very important to be cautious and understand the detailed project situation. If the user is unsure about a project or opportunity, it is recommended to analyze the project and related addresses through the above methods, and participate carefully after fully understanding the risks. Beosin currently uses technical means and analysis systems such as EagleEye and KYT. Through in-depth analysis and risk assessment of projects, it can detect potential or ongoing investment scams in advance and provide timely warnings and suggestions. In addition, Beosin is working with the crypto community, other security companies and regulators in various countries to create a safer and more reliable environment for the Web3 ecosystem to prevent such scams as much as possible. Welcome to click on the public account message box to contact us.
