Binance Recovers 99.9% of Funds from DeFi Exit Scam ‘Wine Swap’ Launched on its Smart Chain


“This is an example of a centralized entity using its resources to help out users who got hurt by a DeFi project,” tweeted Binance CEO Changpeng Zhao after the leading spot exchange shared that they have recovered almost all the funds from the DeFi exit scam.

Out of the estimated $345,000 worth of funds stolen by the DeFi project Wine Swap, by making an exit scam or rug pull, the Binance team has recovered 99.9% of them.

The automated market maker was launched on Binance Smart Chain (BSC), a decentralized exchange which itself rolled out two months ago.

According to the official announcement from Binance, Wine Swap pulled the rug within an hour of its launch on October 13, making away with over $345k, worth as of Nov. 2nd, customer funds.

The victims, identified by their on-chain BSC addresses, had sent a total of 19 different tokens to Wine Swap from 119 different addresses. After making an exit scam, the funds were transferred to the project creator’s address.

When Binance was alerted to the fraud, they followed the flow of funds, from Wine Swap to Binance Chain and then to Ethereum, which were converted into stablecoins, BNB, ETH, and LINK.

The exchange had the funds “successfully frozen in these centralized exchanges after making contact,” which included Binance Bridge, previously known as Panama.

The exchange identified the addresses that fell victim and exactly how much was owed by them by analyzing the transfers. They have also “successfully identified the scammer,” who has been caught red-handed as such “they were quick to cooperate in an attempt to avoid the impending consequences.”

The refund process is now ongoing and is expected to be completed within the next several days.

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