“Dear chat, I’m so unbelievably sorry for what I’ve done”
Yield farming dapp PolyGold has experienced tremendous growth in the past 7 days and suddenly dropped off the radar.
Over the last few months, there has been an explosion of activity on the Polygon network. New dapps are coming thick and fast every week and most land in the DeFi category. The latest entry, PolyGold has seen a surge in activity in the last 7 days leading to an almost 350% increase in transactions. Generated through 2,860 active wallets that handled over $13 million in transaction volume. But something’s not quite right.
A pinned Twitter post stated the above in the early morning on the 9th of June. The ensuing conversation on Twitter was one of a rugpull, an effort to scam and steal people’s money. People stated the lead developer, known only as @Alex_PGF, had written a message indicating “it’s over” in the telegram chat group. Which appears to be true. But, there is some hint of remorse here and that deposited funds would perhaps be returned.
Furthermore, once you navigate to the site, which interestingly is still active, users will find the following message on the yield farming page.
It appears to indicate that ‘early depositors’ can somehow get their funds back and as a goodwill gesture will also be refunded the deposit fee. In a nutshell, the dev is giving back the money to the early investors as they are the ones that helped give the platform liquidity in the first place. The other people are not so lucky. Looking at the stated TVL in the platform through various Twitter posts the apparent rug pull could be worth millions of dollars.
Too good to be true
On the face of it, the new finance dapp doesn’t look anything different from what we have seen over the last few months. At its core, PolyGold is a yield farming platform utilizing its own native token of the same name. In the same way as other DeFi platforms, in PolyGold users lock up their already held tokens to earn POLYGOLD or purchase POLYGOLD to then lock it up and earn.
Interestingly, at the time of writing the stated APY for locking up the native token is 16,228,918.41% with a 0% deposit fee. That’s right, over 16 million percent. In fact, visiting the site right now makes for interesting watching as the percentages alter constantly and the TVL drops with every refresh.
The platform also seems to have caught the attention of London-based Dubstep DJ Plastician, and his almost 60,000 followers on Twitter. The founder of Terror Rythm records and one of the key players in the early Dubstep movement tweeted this out on the 3rd of June. Shill or not. It may have had some impact.
Ups and downs
Looking at the token price it would appear an open and close case. Debuting at around $168 to then hit its ATH of $244 within the same day. Only to then plummet down to under $3 a few days later.
Growth at all costs
As mentioned above, the Polygon Network has been flying recently. According to the DappRadar May Industry Dapp Report the blockchain saw 1,102% growth in total value locked and ended the month around $5.7 billion in total value locked. Polygon grew more than 4 times from around 8,500 unique active wallets in April to 36,000 in May. The activity was fueled by QuickSwap (12,000), Polycat Finance (6,300), and Aave (6,000). Overall, Polygon’s growth was driven by DeFi dapps in two categories: migrating Ethereum dapps and new project launches.
This recent case, although currently still developing, is a word to the wise. If something looks too good to be true then it probably is. As mentioned in previous articles the sheer number of copy-and-paste DeFi dapps arriving on Ethereum rival blockchains lately is alarming. It can of course be very difficult to pick the good from the bad. Due diligence is always important and even doing quick scans across sites and social channels can indicate a lot. However, more alarming is the rash nature of some investors who seem to be willing to chase the yield at all costs.