In the wake of the TRUMP meme coin’s impressive launch, which reached a valuation of $72 billion, the cryptocurrency market experienced a surge of scams. Analysts report that approximately 6,800 counterfeit tokens and 91 fraudulent decentralized applications (dApps) emerged swiftly.
The initial wave of enthusiasm can swiftly devolve into disorder. The introduction of the Official Trump meme coin in January not only garnered significant interest from the cryptocurrency community but also unleashed a torrent of fraudulent activities, as scammers sought to take advantage of the excitement, inundating the market with counterfeit tokens and malicious applications.
On January 17, President Donald Trump introduced his meme coin, which is promoted as a distinctive opportunity to demonstrate “support for, and engagement with, the ideals and beliefs” represented by the symbol TRUMP. This information is detailed on the official website of the meme coin and was also highlighted in Trump’s announcement on X.
In a mere 48 hours following its launch, TRUMP reached a market capitalization of $72 billion, which analysts from the Israel-based blockchain forensic company Blockaid describe as a “perfect storm for fraud.” This rapid increase not only drew in speculators eager to make quick profits but also attracted nefarious individuals looking to exploit the ensuing excitement.
The blockchain company disclosed in a research report that fraudsters swiftly took advantage of the excitement generated by the token’s launch. These unscrupulous individuals rapidly inundated the market with counterfeit tokens, aiming to mislead investors who were keen to participate in the trend.
The report indicates a 206% rise in tokens associated with the name “Trump” on the day of the launch, escalating from 3,300 to 6,800 tokens. These fraudsters generated a multitude of tokens intended to imitate the TRUMP meme coin, thereby complicating the ability of investors to differentiate between authentic assets and deceptive ones.
A representative from Blockaid informed crypto.news that fraudsters have been making it progressively challenging for investors to differentiate between authentic tokens and fraudulent ones.
“[…] and this challenge is not unique to TRUMP. In almost every major web3 launch, our team sees how threat actors are creating projects that mimic the branding and excitement of the real tokens, creating confusion and exposing users to significant risks.”
Oz Tamir, the research and development lead at Blockaid
The high demand for TRUMP tokens among the public allowed these fraudulent assets to gain popularity and ultimately yield profits for the scammers involved.
A similar increase in interest was observed in malicious decentralized applications, which experienced a significant uptick following their launch. According to Blockaid, the day after the meme coin was introduced to the market, impersonator dApps witnessed a 14-fold increase, with over 90 counterfeit applications emerging within a mere 24 hours.
Blockaid’s report further indicates that fraudsters extended their activities beyond the TRUMP token. Other tokens associated with the Trump family, including “Melania” and “Barron,” experienced increases of several hundred percent, suggesting the existence of a network of tokens linked to the Trump brand. According to Blockaid, these tokens contributed to the “illusion of an interconnected ecosystem.”
Tamir observes that the most significant increase in counterfeit tokens was evident on the Solana network, particularly during this launch, due to the widespread presence of meme coins within the ecosystem.
“That said, EVM networks like Ethereum have consistently been a hotspot for scams as well, including both fake tokens and malicious dApps targeting EVM users.”
Oz Tamir
As the enthusiasm surrounding prominent launches increases, so too does the potential for fraudsters to deceive unsuspecting individuals. Regrettably, the decentralized characteristic of cryptocurrency, although empowering for users, simultaneously creates opportunities for nefarious individuals to manipulate the system.
In light of the increase in scam activities, Blockaid has stated that it is actively working to prevent users from engaging with harmful tokens and counterfeit decentralized applications (dApps). Following the introduction of the TRUMP token, the company revealed that it has successfully blocked hundreds of users from interacting with fraudulent assets.
