SnowdogDAO is supposedly the victim of a rug pull. The Snowdog cryptocurrency has piqued the interest of many potential investors. As a result, SDOG’s price skyrocketed past $6,000 in a matter of minutes after it began trading on November 18. The price has dropped below $2,000 since then.
Snowdog is a meme cryptocurrency created by Snowbank, a DeFi-focused project. Another token in the project is called SB, and its price has recently risen dramatically. The Snowdog token was created by the Snowbank project for its millennial community. The coin is built on the Avalanche blockchain, which, along with Cardano and Solana, is one of Ethereum’s main competitors.
The SDOG token of Avalanche (AVAX) has lost 90% of its value today. Likewise, SnowdogDAO’s and its Avalanche-based token SDOG’s value has been wrecked today, according to various tweets sent by followers.
The rug pull happened when the company promised a 40 million repurchase on its own DEX Snowswap and moved all liquidity from Joe.
Snowswap contracts require a “challenge key” to trade, which only insiders knew of ahead of time. These insiders then back ran the repurchase and profited $10 million.
No one else could back run the massive buyback without knowing the “challenge key” because the Snowswap contract wasn’t validated until insiders finished their trades.
@SnowdogDAO tweeted that they will validate the contract as soon as possible to show everyone how they did it. In addition, they will migrate the liquidity to a standard AMM in the coming days.
According to SnowdogDAO, their AMM, based on Uniswap v2, has been significantly altered to make bots’ lives more difficult. It became impossible for bots to quickly adapt and learn how the switch works after adding a basic mathematical hurdle to the AMM. In addition, only those who were utilizing the front-end were able to swap.