CertiK’s identification of Crypto Cars as ‘rug pull’ was a false alarm

In a period of market downturns, rumors of crypto bans and decentralized finance, or DeFi scams, blockchain enthusiasts can be sensitive to the smallest abnormalities within projects they follow and sometimes erroneously fear for the worse. The day prior, CertiK, a leading cybersecurity ranking platform in the blockchain space, issued a warning via Twitter regarding CryptoCars, alleging that it was a “rug pull.” However, the staff quickly deleted the post as it was a false alarm.

Via a series of Twitter screenshots obtained by Cointelegraph, CertiK first claimed that the website and Telegram for CrytoCars were down. However, users quickly pointed out that both the CryptoCars website and Telegram apps were still functional, resulting in CertiK rescinding the community alert.

According to the developers of CryptoCars, the project’s Telegram chat will be temporarily closed “until the end of the Lunar New Year from 27th Jan to 7th Feb.” The CryptoCars development team is based in Vietnam, which celebrates the Lunar New Year holiday.

Sources at CertiK issued the following statement to Cointelegraph regarding the incident:

“Incident reporting, although complex, is rapid in nature and is done in a manner to alert the community on up-to-date suspicious activity. In this situation, we noticed [their] Telegram went offline, funds dropping to zero, and the $CCARs website being unavailable. This created an alert of a possible rug pull.”

Despite the error, CertiK has done much to benefit the blockchain community. As recently as the day prior, it issued a verified community alert for Qubit Finance as the protocol suffered an $80 million hack.

CryptoCars launched in September 2021 as a nonfungible token, or NFT, car racing game. Structured under a play-to-earn model, CryptoCars requires players to purchase an NFT car minted on the Binance Smart Chain through a blind box created by its developers for 6,600 CCAR or from another user starting at 490 CCAR. According to its official site, the project claims to have 721,683 players, 582,666 NFT cars, and 248.8 million in-game transactions at the time of publication. It also has over 124,500 followers on Twitter.