Arbitrum-Based DEX ArbiSwap Rugs Its Users, $ARBI Plummets 100%

The developers minted one trillion ARBI tokens before dumping them on the market and swapping for USDC and ETH.

A man sitting on the edge of a cliff and staring at a dust cloud.
  • ArbiSwap developers minted a trillion ARBI tokens and swapped them for USDC and ETH.
  • ARBI is down 100%.
  • The rogue developers moved the stolen funds through the Etheruem-based mixer Tornado Cash.

ArbiSwap, one of the first decentralized exchanges built on Ethereum Layer-2 Arbitrum, has seemingly rug-pulled its users.

On Thursday, the developers behind ArbiSwap minted a trillion new ARBI tokens and swapped them for USDC and then for ETH. ARBI plummeted from $1.5 to a fraction of a cent in seconds.

The rogue developers could do so because they control ArbiSwap’s liquidity pools. Some industry observers believe that ArbiSwap is hardrugging, meaning they’re draining every pool available on the exchange.


So far, the developers have been able to steal around 69 ether (ETH) ($113,160). They have moved 84 ETH in total through Tornado Cash, an Ethereum-based mixer that’s been blacklisted by the U.S. Treasury.

ArbiSwap launched in February and quickly grew to $5.02 million in total value locked (TVL), according to data from DefiLlama. The decentralized exchange offered low transaction fees enabled by Arbitrum’s Layer-2 design and attracted users by promising to give all protocol revenue back to ARBI holders.

On the Flipside

  • While it’s always sad to see users’ funds being stolen, the total amount stolen from ArbiSwap users is small compared to other scams. 

Why You Should Care

The crypto industry is still full of scammers and grifters. Users should always do extensive research before choosing which platform to use, especially if the platforms they like are new and have yet to be battle-tested.


Learn more about recent crypto scams and hacks: 

MyAlgo Advises Users to Withdraw Funds After $9.2M Hack

Oasis ‘Counter Exploits’ Wormhole Hacker to Retrieve $225M on Court Order

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Arturas Skur

Arturas Skur is a cryptocurrency news reporter at DailyCoin who covers Web 3.0 domains, DeFi, and Ethereum Layer-2s. With over five years of experience in journalism and public relations, Arturas brings his critical thinking and analytical abilities to deliver insightful news stories. In his free time, he enjoys hiking, playing with his dog, and reading.