Ethereum Ongoing Gambling Problem Resulting in Unrelenting Rip-Offs
Unrelenting Rip-Offs? Ethereum’s Gambling Problem Is Getting Out Of Hand
Ethereum has a gambling challenge. Since last month, there are products which are similar to Ponzi schemes that have topped charts among distributed applications. These are largely fraudulent forms of investment programs which promise very high returns, but cost little. They prefer to run on Ethereum, one of the largest blockchain platforms in the world.
It has been observed that user counts as well as transaction volumes have remained quite high on these applications. This raises concerns regarding the kind of risks consumers are bound to face when making use of them. Presently, there are a number of warning cries from experts who are not very much known for their risk discretion. Apparently, the group comprises of dapp designers who specialize in developing gambling applications.
For instance, Team JUST, an unspecified group came up with a scandalous gambling application known as FOMO 3D. They recently cautioned the public against using a nearly duplicate copy of their game, which ate up almost 30% of their total computational power, ending up realizing approximately $7 million in ETH within just one week in operations.
Recently, Team JUST went on record not just privately, but also publicly to claim that the fraudulent game was actually a Chinese mobile app known as LastWinner, which allegedly was set up to deceive users by put on show fake, bot-driven game activity.
As a way of expounding on this, Team JUST implies that the game fundamentally utilizes its own ether, 200,000 precisely, as a way of powering several transactions which are done by computer bots. This is done to make it appear like the game is very popular with users, as well as being a genuine gambling application. As a result, this lures ignorant users to engage with Team JUST’s ether in the hopes that they will win it big.
‘Just-Bot’, a pseudo name which is used by one of the developers of Team JUST, went a great length in making proclamations in a channel-wide Discord. The statement was posted last Tuesday whereby he cautioned the public that there is a likelihood that LastWinner is being operated by crooks.
Just-Bot asserts that the scale of the wallet as well as that of the bots, in addition to the sheer quantity of gas in use, is a clear indication that the dapp is an illegitimate organization being run from China. This is meant to scam people on a large scale, that even Ethereum ecosystem has not witnessed before.
The Parameters Of Analysis
Over and above, these developments have left many concerned, not just developers. In the recent past, the occurrences have also left users and analysts alike concerned, with many raising alarm bells on a number of diverse virtual channels over the flurry of transaction activities which have been observed as a result of the new gambling application, LastWinner.
First and foremost, several stakeholders were perplexed and were just imagining what exactly was taking place. Just a couple of days following the launch, several remarks on Etherscan established that there were questionable activities with the dapp, especially after users noticed that it was actually outdoing even those it was created to duplicate.
There was a case in point whereby one of the users attested to the fact that the dapp was in essence a very popular F3D clone, which in many ways, outstrips the original one quite easily. Certainly, the action was swiftly recognized by data providers as an inconsistency.
A blockchain watching and analytics company called Amberdata actually elucidated to CoinDesk due to the duplicate of the FOMO 3D gambling application, the Ethereum blockchain has been greatly affected as a result of being overloaded.
Up until mid-August, approximately $50 million of value, comprising of outgoing as well as incoming funds have been transacted through the dapp. An official from Validity Labs, Dr. Alexander Sokolowska, also commented on the activity, asserting that the highly synchronized and programmed interactions on the dapp are a clear indication that there must be computer bots being used.
In an email sent to CoinDesk, Dr. Alexander asserts that it is not possible to perfectly determine the exact nature of the dapp. This is because the source code cannot be seen, making it very difficult to know the exact drive of the code.
She goes ahead to caution that there is a possibility that someone could be shrewdly reassuring honest users to engage in the game by producing simulated activities using Sibyl accounts, just to take away the funds at the end of the day.
Acquaintance Or Adversary?
Using the aptitudes of analysts limited, the serious words of warning presented by Team JUST have provoked an element of mistrusts that points back to the exact nature of the novel FOMO 3D application itself. This is due to the fact that in as much as both the gambling applications have perfect directions on the guidelines of their games, the primary codes used in the real positioning of the game are yet to be entirely revealed and substantiated.
In many ways, users are concerned that the fact that the source code cannot be verified makes the dapps very risky to invest in. According to Scott Bigelow, a dapp developer, whenever it is impossible to verify a source code, the possibility of malevolent intent as well as viruses is very high. Scott asserts that due to the uncorroborated contract of FOMO 3D, the stoppage of the whole game is looming, with a possibility of one player claiming the bonanza all for themselves.
Scott goes ahead to assert that the entire game is a typical exit scam in which the developers of the application can pull off a coordinated endeavor to take over the funds. This is a vulnerability which is also the same case with LastWinner dapp, due to the fact that it also runs on unsubstantiated source code.
Another potential risk of the two gambling applications is the fact that both have a common ‘airdrop vulnerability’. In this way, little sums of consumer’s money can be shrewdly skimmed from airdrop prizes. This was reported by Peter Szilagyi, an Ethereum developer.
Consequently, allegations by Team JUST even as they attack LastWinner regarding scamming activities actually raise questions on their intentions since LastWinner is actually a duplicate of their game. A Reddit commentator claims that if LastWinner is a clone, then the original version has the capacity to exit a scam.
An Unstoppable Force
All the same, the nature of activities of the dapps may not necessarily be determined. This is because without the contract code, it is not possible to say much. It is worth noting that gambling dapps as well as their duplicates may not disappear in the near future due to the way they lure people as a result of the impressive returns.
Additionally, the ‘free market’ nature of the Ethereum blockchain makes it possible for anyone to make an investment in any form, and so will definitely use the opportunity. It is therefore not surprising that in spite of the growing concerns of the risky nature of the games, communities of their users fiercely prevent them from being shut down. Over and above, it has been observed that the general populace supports decentralization, until it works contrary to their expectations.