The past week in crypto began with another hectic whirlwind of events, primarily directed toward Coinbase’s Layer-2 Base network. Not only did the meme coin $BALD stir headlines overnight with its $100M rug-pull, but rumors also began to sprout that it was connected to Sam Bankman-Fried. Additionally, Base’s primary Decentralized Exchange, Leetswap, halted its trading on the platform due to an exploit. With help from ZachXBT, the renowned crypto on-chain record digger, continue reading the article below to find out who the $BALD deployer was.
What is Base Network?
Base Network is a Layer 2 solution developed by Coinbase to solve scalability challenges and reduce transaction fees on Ethereum.
Leveraging optimistic rollups, Base offloads transactions from the main Ethereum chain and executes them off-chain, bundling them into batches before submitting them back. This greatly increases transaction throughput and allows users to interact with the network in a cost-effective manner—leading to quicker transactions and lower associated transaction costs.
Rise & Eventual Downfall (Rug) of $BALD
Launched on the Base network on the 31st of July and inspired by Coinbase’s CEO Brian Armstrong’s bald head, the $BALD meme coin swiftly gained significant traction. Speculators, looking to hop on seemingly lucrative opportunities on the up-and-coming network backed by one of the largest centralized exchanges globally, were drawn to it. Within just two days, it had amassed a market cap of over $100 million – all before it later plunged by 92% overnight, according to CoinGecko data.
The Creator Behind It All: In the first 24 hours of its introduction, the deployer of $BALD bolstered the liquidity pool by injecting approximately 6,700 $ETH (or $12.5M USD), causing a significant upward trend in price. This led to growing interest, where shillers began promoting the coin on Crypto Twitter.
The deployer continued to manipulate the price each time it hit a certain standstill or decline, triggering the price to surge beyond expected values — 3000%+ — creating millionaires overnight. This gain was also attributed to the fact that many were potentially speculating on ‘being early’ on the platform could be advantageous given it was one of the first few meme coins with explosive price action, and that there was no official way to bridge out funds off the Base network.
However, shortly thereafter, the deployer extracted all the liquidity, achieving a profit of 3,048 $ETH (or $5.7M USD). This led to the drastic price volatility of $BALD, culminating in what we have identified as a rug pull.
How it Links to Sam Bankman-Fried
With digging into on-chain records and wallet tagging, the downfall of $BALD was quickly rumored to be connected to the infamous former FTX Co-Founder, Sam Bankman-Fried.
- Transactions occurred between the wallet address of the $BALD developer and Alameda Research, the controversial trading firm set up by Sam himself. Reminder: Alameda Research bore the brunt of a $1 billion loss incurred by its affiliated firm, FTX, after a huge mismanagement of funds. The frequency and extent of these transactions were also quite significant, with funds regularly interacting with one another, amounting to over $20 million.
- Alongside previous interactions with Alameda, the $BALD developer’s wallet address was also connected to Andrew Keys (co-founder of DARMA Capital), Wintermute OTC, and a multitude of $USDT blacklisted addresses. While this key information does not necessarily mean that the $BALD developer is directly linked to any certain connection, it is observed that they have ties with many influential personalities.
- Last but not least, the $BALD developer also seems to be connected with the Terra UST depeg, which Sam/Alameda is rumored to have orchestrated as an attack on LUNA using Curve, with the intent to profit millions. A new address linked to the UST depeg ‘attack’ has been depositing to the same Binance address as the $BALD developer.
According to a recent analysis update from ZachXBT, it is highly likely that the BALD deployer is Twitter user @milkyway16eth, whose wallet address is: 0x0b6e7d5668c4a0a8e13d618b1ffc4406d079141e022381aad379040518dec285.
The wallet transferred a total of 14.83M $USDC and 400 $cbETH to the BALD deployer address. Both of them share the same Binance and FTX deposit address. The investigation is still underway, so more will be revealed in due time.
LeetSwap DEX Exploited?
On top of all that, LeetSwap, the only Decentralized Exchange available on Base and a platform that also facilitated trading for the $BALD coin, has decided to temporarily suspend trading on its platform.
LeetSwap allows users to lock their tokens in exchange for native $LEET token rewards; however, they received reports from users that their locked liquidity in the Axelar Wrapped USDC ($axlUSDC) and Ethereum ($ETH) pool had mysteriously disappeared.
The decision was then made following the team’s suspicion that their trading pools had been breached, with efforts underway to recover any locked liquidity that might have been affected by the potential exploit.
Notably, this potential exploit occurred at a time when LeetSwap had recorded a significant surge in deposits (~$41.2 million), amidst the meme coin hype.
How to Get Started on Base Network
Without a doubt, one must always exercise caution when interacting with cryptocurrencies, given the dynamic and borderless nature of the Web3 hemisphere. Any token can drop to zero, regardless of what the public sentiment may seem like.
However, if you’re still looking to get started on the Base network, refer to our guiding steps below:
Step 1: Adding Base Network to Metamask
You can add Base to your Metamask wallet in 2 ways:
Option A: Manually input the following details into Metamask
- Network: Base Mainnet
- Network URL: https://mainnet.base.org
- Chain ID: 8453
- Currency Symbol: ETH
- Base explorer URL: https://basescan.org
Alternatively, Option B is to directly add the Base Mainnet network by visiting http://chainlist.xyz.
Step 2: Bridging into the Base Network
Bridging from Ethereum Mainnet to the Base Network can be easily achieved by sending $ETH from the Ethereum Mainnet to the following proxy contract.
Proxy Contract Address: 0x49048044D57e1C92A77f79988d21Fa8fAF74E97e
Please take note that you can only send $ETH to this contract, any other token will not go through!
After the transaction, wait for the ETH to be deposited into your wallet on the Base Network.
Step 3: Useful Tools for the Base Network
Here are some tools to help you throughout your journey on Base:
- Chain Explorer: https://basescan.org
- Chain Metrics: https://defillama.com/chain/Base
- Dune Dashboards: https://dune.com/tk-research/base
- Real-Time Price Charts & Analytics: https://dexscreener.com/base
- Guide: https://docs.base.org
Step 4: Bridging Out of Base Network
Currently, there are only unofficial options to bridge your funds out of the Base Network; use them at your own risk!
You may refer to this: http://okok.network/#/bridge
It is highly recommended that users wait for the team to release an official bridge UI first, expected to come in August, or for more reliable bridging options like Stargate to become available.
[Editor’s Note: This article does not represent financial advice. Please do your own research before investing.]
Featured Image Credit: Chaindebrief