The IT security firm Check Point Research (CPR) has expressed concern regarding the Dingo (DINGO) token. The Dogecoin offshoot has a market capitalization of $10.9 million and is ranked #774 on CoinMarketCap
According to CPR, the project’s anonymous owner boosted the token’s purchasing and selling fees to an astounding 99% by using the “setTaxFeePercent” method, thus placing investors at risk of losing all of their money.
The website for the Dingo token has very little information on the project’s founders and simply includes a basic, four-page white paper outlining the project tokenomics.
The project claims to implement a burn plan that benefits long-term investors in its white paper, In the sake of openness, the website displays the total quantity of Dingo Tokens burnt. Realistically, though, the only thing being burned here are the wallets of unsuspecting investors.
A 10% fee per transaction is mentioned in the white paper. But after looking more closely at the smart contract’s source code, CPR found the above mentioned “setTaxFeePercent” function, which gave the owner the ability to alter the buy- and sell-fee amounts.
The current fee is set at 99% and the function has been utilized 47 times. A user invested $26.89 in a buy transaction, but only received 4.27 million Dingo tokens, or 1% of the amount invested.
CPR claims that the transaction is taxed at a rate of 95% tax and 4% liquidity fee, for a total fee of 99% on any transaction. In other words, the project is blatantly stealing money from its users.
CPR warns cryptocurrency users to exercise caution when purchasing tokens since scammers can generate scam tokens and hack contracts in a number of other ways.
Scammers will continue to develop new strategies to steal money with cryptocurrencies as long as the market is still in its adolescence. Investors need to exercise extreme caution and only purchase tokens after thorough study as cryptocurrency continues to gain popularity.