On June 7, the team behind the Zksync project Gemholic withdrew 921 previously locked ethereum tokens in a suspected rug-pulling incident. The Gemholic team executed the theft despite reportedly completing the blockchain security firm Solidproof’s Know Your Customer (KYC) process.
Allegations of ‘Rug Pull’ Arise After Gemholic Team Withdraws $3.5M in Previously Locked ETH
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Zksync’s v24 Upgrade
The layer two ( L2) Ethereum blockchain scaling protocol, Gemholic, faced allegations of a rug pull after 921 ethereum ( ETH) tokens, valued at $3.5 million, were withdrawn from the Zksync project’s smart contract funds. The funds, erroneously locked in the project’s sales contract over a year ago, became accessible following Zksync’s v24 upgrade.
N Serec, a social media user and founder of ZK Markets, claimed that the Gemholic team executed the theft despite completing the blockchain security firm Solidproof’s Know Your Customer (KYC) process. N Serec suggested that Solidproof’s silence could be an attempt to avoid spreading fear, uncertainty, and doubt (FUD).
The ZK markets founder further stated that Solidproof should take measures to reassure the impacted users: The founder said:
A KYC provider must either admit its incompetence in conducting thorough verifications or take action in reporting fraudsters to authorities and making a public statement. If Solidproof continues to ignore this issue, then their platform is useless and should be discredited.
N Serec urged affected users to hold the blockchain security firm accountable and to reach out to Binance—the funder of the compromised account. Following the alleged June 7 rug pull, the Gemholic team deleted its X account and some messages on Telegram.
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