ZkSync’s Gemholic project suspects $3.5 million rug pool
The cryptocurrency community is seething with concern following the alleged rug pull incident involving the Gemholic project and the zkSync network.
Several users who have fallen victim to the alleged Gemholic scam have taken to the X social platform to raise awareness. NSerec, founder of Zkmarkets, confirmed that Gemholic stole $3.5 million.
In the Once the funds were finally unlocked, the team implemented what appeared to be a rug pull. NSerec said the contract creator’s address is believed to have been funded by Binance and asked community members with insight on how Binance could help to contact them.
KYC provider silence
Despite completing a Know Your Customer (KYC) verification with SolidProof, the verification service has not publicly addressed the situation. NSerec believes that this silence is probably an effort to prevent fear, uncertainty and doubt (FUD) from spreading among investors.
According to NSerec, KYC providers must either admit that they failed to properly verify the people involved, or report the fraudsters to authorities and inform the public about what happened. If KYC company SolidProof continues to ignore this issue, it means that their services can no longer be trusted.
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The Zkmarkets founder said that if SolidProof fails to address the Gemholic scam, those affected will have to hold SolidProof accountable. He even suggested that if they don’t take action, people should start calling them “UselessProof” instead of “SolidProof”.
back story
zkSync project Gemholic had its funds locked up for over a year due to a mistake in its sales agreement. Matter Labs, the team behind Ethereum layer 2 scaling solution zkSync, has identified the issue as occurring in the .transfer() function of the GemstoneIDO smart contract, part of a project operating in the GemholicECO ecosystem.
On June 7, zkSync completed the v24 upgrade, which fixed the issue and made locked funds accessible.
Following the upgrade, the Gemholic project withdrew 921 Ether (ETH) from its contracts and transferred them to the Ethereum blockchain. Gemholic’s X account and all Telegram messages were also deleted at the time of publication.
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