NewsCoins

Peckshield Sounds Alarm on Honeypot Posing as Terra Fork

The potential scam was discovered on Binance Smart Chain.

2 min read
Image: Shutterstock.

The blockchain security firm Peckshield today warned investors about a newly deployed honeypot pretending to be “Terra Luna Classic” (LUNC) on Binance Smart Chain (BSC).

The honeypot emerged after a proposal about forking Terra's blockchain was proposed by co-founder Do Kwon. According to the proposal, Kwon seeks to create a new Terra blockchain without the stablecoin UST, and the old chain would be renamed “Terra Classic.”

The Terra Luna Classic honeypot seems to be operating out of a phishing website named v2terra.com, according to Peckshield.

The currently deployed LUNC honeypot on Binance Smart Chain has been actively traded on Pancakeswap, the most popular BSC-based exchange. According to data from Pancakeswap, the total trading volume of LUNC topped $135,000 over the past 24 hours.

A honeypot is a smart contract that pretends to leak some funds to a random user (victim) provided that the user provides additional funds. However, the funds sent by the user would be trapped in the contract, allowing only the creator to access them.

A common honeypot scam would promise to send back twice the deposited amount, so a user would be promised 2 ETH for sending 1 ETH, but the honeypot creator would just keep that 1 ETH and send back nothing.

“Do not connect your wallet! Terra 2.0 (or not) is still in Preliminary Vote,” warned Peckshield.

The proposal to fork LUNA was voted against by 90% of LUNA holders, which means no new LUNA-related chain has been deployed. Any change to the Terra ecosystem has to be submitted as a proposal, and a majority of LUNA holders would have to vote in favor.

Want to be a crypto expert? Get the best of Decrypt straight to your inbox.

Get the biggest crypto news stories + weekly roundups and more!