ImmuneFi Report Reveals BNB Chain as the Home for Rug Pulls

ImmuneFi’s recent report stated that the Binance-launched BNB Chain has witnessed over $1.6 billion in the previous four years since its launch in 2020. 23% of those losses, or $368 million, occurred due to rug pulls, putting BNB Chain ahead of all other blockchains in terms of rug pulls. For instance, Ethereum has reported $3.6 billion in losses since its inception, while only 4.4%, or $158 million, was attributed to rug pulls.

Rug pulls occur when shady developers launch tokens and sell them to users with guarantees of building promising utility but abandon development after receiving the desired funds from unsuspecting investors. Resultingly, the developers walk away with free money while users have the rug pulled from under them, leaving them with worthless tokens.

The report explained why BNB Chain is at the forefront of rug pulls in the blockchain ecosystem, “The primary reason for this is that BNB Chain has faced a serious issue with developers using forked code.” It further elaborated on the blockchain’s user base, “Its community has lacked a security-first approach and attracted many users looking for a quick way to earn money.”

Scammers have thus wreaked havoc using rug pulls. BNB Chain witnessed $22 million in losses from this type of scam in 2020, $107 million in 2021, $152 million in 2022, $73 million in 2023, and $12 million in 2024 thus far. Of the total $368 million lost from rug pulls over these years, the DeFiAI rug pull alone accounted for $40 million. The report suggests 228 rug pulls have occurred on BNB Chain since launch.

ImmuneFi further informed readers about indications of rug pulls, “Signs of a potential rug pull might include false claims of audits or resistance to implementing ongoing code review or bug bounties, centralized token control and distribution, inactive community engagement, promises of unusually high returns, and lack of a genuine use-case.”