The Ethereum network has recorded more activities than ever before. In fact, the network has been used so much that ETH miners have recently chosen to increase the block capacity by 25%. Thus, it is allowed to perform several transactions and complete several processes every 14 seconds.
This increase in network activity can be attributed to many things.
First, the migration of the stable USDT (Tether) currency into Ethereum has led to a massive increase in ERC-20 tokens. Second, decentralized financing projects, such as the smart investment platform Set or the decentralized bank Compound, have generated network traffic.
But most importantly, the questionable smart contract called “FairWin” has gained immense popularity. 50% of all the “burned” Gas in the Ethereum network was claimed by this contract. Smart contract data shows that he made 360,000 transactions once.
This may leave you wondering, what is FairWin?
This Ponzi “Correct” is not so sure.
Well, to put it simply, it’s a “fair” Ponzi scheme, which offers dividends to early game participants and is built on the involvement of multiple users – which is basically how a pyramid scheme works.
For some reason, FairWin, which targets a Chinese audience, has managed to gain massive traction.
So much traction, that Etherscan reports that the contract has a value of over $ 6.5 million. Moreover, FairWin has dozens of transactions every minute, while some parts of the pyramid are likely trying to turn a profit on their “investment.”
Although this is far from being the first example of a “decentralized pyramid scheme”, it is apparently the first large-scale contract of this kind and is believed to be quite vulnerable to attack.
Philippe Castonguay, R&D at Horizon Games, recently wrote on Twitter about the FairWin contract as having “critical vulnerabilities that put all funds at risk,” and then asked his followers to disseminate this information.
The https://t.co/1HHnXNCWsL Ponzi Scheme contains critical vulnerabilities that put all funds at risk.
Spread knowledge (especially in Asia) ? Users need to withdraw their funds and stop interacting with the contract ASAP.
Details on the exploits will be published soon.
– Philippe Castonguay (@PhABCD) September 27, 2019
Ameen Soleimani, the executive director of the Ethereum SpankChain adult entertainment project, has doubled these concerns, saying that this contract can be “emptied by the owners … and is also susceptible to an attack by” black hats. “
Fair warning: The FairWin Ponzi contract can be drained by the owners. There is a separate attack black hats can do if the owners don’t stop it (by draining it themselves).
FUNDS DON’T KNOW!
Please inform the Chinese to stop throwing money at it. https://t.co/6ST1ngIonv pic.twitter.com/Nv1TDQDuSd
– Ameen Soleimani ? (@ameensol) September 27, 2019
It seems that users are responding to these fears. In recent days there has been an exodus of hundreds of thousands of dollars in Ethereum, probably while waiting for a bad actor to take advantage of the apparent security gap.