In a startling revelation, rogue ex-members of the Pepecoin (PEPE) project were accused of illicitly withdrawing $16 million worth of PEPE tokens from the project’s multisig wallet. The incident, which occurred on August 24, 2023, led to a 15% plunge in the value of PEPE tokens and sparked fears of a potential “rug pull” within the cryptocurrency community.
The heist unveiled
The Pepecoin project, which was launched in April, had its multisig wallet set up to require the approval of 3 out of 4 signers for any transaction. However, on the fateful day, three former team members allegedly logged onto the multisig wallet without authorization and transferred 16 trillion PEPE tokens—equivalent to 60% of the wallet’s total holdings—to various cryptocurrency exchanges including OKX, Binance, Kucoin, and Bybit. Following the unauthorized transaction, these individuals reportedly removed themselves from the multisig setup and deleted all their social media accounts, leaving behind a message that the remaining team member was now in “full control.”
Official clarifications and community response
In an attempt to clear the air, an anonymous founding member of the Pepecoin project released an official statement on August 25. The statement claimed that the remaining 10 trillion PEPE tokens in the multisig wallet were secure and would be transferred to a new wallet. The founding member also expressed intentions to “do what’s right for the PEPE community” and criticized the rogue ex-members for their greed and detrimental impact on the project since its inception.
The Pepecoin team further clarified that the stolen tokens were never intended for market sales or personal profit. The incident has revealed the internal strife and disagreements that have plagued the Pepecoin project from its early days. A portion of the team, characterized by large egos and avarice, had separated themselves from the project within the first week of its launch, thereby slowing down its progress.
Despite the unsettling news, the price of PEPE tokens showed a 5.7% increase within 24 hours of the incident, according to data from CoinGecko. The market cap stood at $382.7 million, indicating a somewhat bullish sentiment among investors. On the other hand, the Pepecoin price was up almost 7% in the last 24 hours, with a market cap of $354.98 million, as per other sources.
The remaining Pepecoin team member is reportedly working towards acquiring web domains and usernames for PEPE and has plans to burn the remainder of the tokens when these acquisitions are complete. The official PEPE Telegram group remains locked due to hacking concerns, and the primary channel of communication is now the @pepecoineth Twitter account.
In conclusion, the incident has served as a cautionary tale for the cryptocurrency community at large. It has highlighted the necessity for due diligence and caution when dealing with multisig wallets and tokens, especially in projects where internal conflicts and rogue elements can compromise the security and integrity of community-held assets.