[DANGER][SCAM ALERT] XAMATEK token admins abused their power to freeze customer funds in our DEX

In a shocking turn of event, it has come to my attention that people are unable to trade XAMATEK token on Saturn Network. Neither can they withdraw their funds from the DEX, which is an even worse situation. So who is it to blame? I set out to investigate and what I have found out SHOCKED ME.

TLDR: Xamatek has admin functions in token (e.g. like fiat, not like bitcoin) that allow them to freeze a balance. They froze Saturn Network DEX smart contracts, and now honest token holders and traders have had their funds locked up. If you hold XAMATEK, demand the admins to STOP THIS IMMEDIATELY. I do not recommend buying XAMATEK until they issue a new smart contract and purchase a high quality security audit to confirm it has no backdoors.

Let’s jump straight to the code for proof.

https://etherscan.io/address/0x767ee3150ac31f982190ef41728cf9a969355286#code

Up until line 207 everything is hunky dory, good. But then we see this.

What is this balanceLocked bullshit? Who controls which balances are locked? Keep scrolling through the code.

So it looks like the Owner can freeze arbitrary balance, without any warning or court order. Did they really do this? Let’s go down to this other link to test (make sure you have metamask or saturn wallet or trust wallet activated to Ethereum network to proceed and validate my words yourself).

https://etherscan.io/token/0x767ee3150ac31f982190ef41728cf9a969355286#readContract

Scroll down to “6. balanceLocked”. Let’s try this with a random trader address.

All good. BalanceLocked is false, meaning it is unlocked and ready to transfer. But what about Saturn Network smart contracts?

OMG! They froze everybody’s money on the exchange, a whole 8,142,769 XAK are locked up and honest customers cannot withdraw their funds! Let’s scroll down and find out who this dirty motherfucka owner is. At the moment of writing this, it is this guy. https://etherscan.io/address/0x41ea5a7f865d85f7eccc817bcb72b1f315d14236

And what he is doing SHOCKED ME. Here is their algorithm

  1. Unlock Saturn Smart Contract.
  2. Wash trade to create an illusion of demand. Notice that it’s same two traders over and over again.
  3. Lock Saturn Smart Contract, along with any customer funds, to prevent people from selling the coin. Luckily nobody can buy it either when it is locked, so more people don’t get scammed… But those who have created sell orders are unable to cancel them!

Unfortunately as a DEX there is nothing we can do. However, I hope this message spreads around and people will find out that XAMATEK IS A SCAM and will not buy it.

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Ohh my geeee… everything now is clear. Why I can’t cancel… it’s good to be true. Fake token and scam!

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Tricky fuckers

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Pathetic!

Thanks for that audit @Neuron, I have also notified Bamboo Relay and they have immediately de-listed XAK. This kind of garbage scam makes me think we may have to re-think our token listing process. :open_mouth:

From looking at their Telegram group it appears they tricked people into buying into their “SelfDrop” (the new term for ICO) by showing the price was steadily rising on Coingecko. Leaves a bad taste in my mouth this one.

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Yes, thanks for the detective work, Neuron! But it really is a shame, and commiserations to those who have been scammed.

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great investigation, thx.

+1 adding this post to the tokeninfo-box on saturn.network

+1 changing image on github to https://forum.saturn.network/uploads/default/original/2X/3/352c657a2e73fad018330b6df323b388799f45c0.png

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Hi. Thank you for the information, I’m honestly shocked how it happened that these scammers from Xamatek appeared on such a well-known and reliable platform, I hope the administration of " Saturn.Network " will figure it out.

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Latest update and response from Xamatek posted here:

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Why does “Xamatek” ban people in telegram chat even just for mentioning " Saturn.Network". The situation is very strange, I personally have a lot of Xak coins. We can only wait for them to unlock our coins, if that happens at all.

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My theory is because they do not have good intentions in mind, and once we have exposed their scam they now try to censor this information, and that’s why they ban people.

If they really cared about their investors they would show up with a response in this thread.

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Hi guys, Can I ask you some infos about the corona coin ? at the beginning the member were planning to do it as a scam, I’ve talked to them and they’ve revealed that it was true (wtf), so Was thinking are the same amount of shit in the code or not ?

do you think they could do the same ? *