Solana Slows After Rally, Users Fear First Project ‘Rug Pull’

The recently massive price rise of the Solana blockchain’s native token SOL took a breather on an otherwise green day for the crypto market, while news broke that a Solana-based decentralized finance (DeFi) protocol known as Luna Yield went offline.

At press time on Friday (08:39 UTC), SOL was down by 1.1% over the past 24 hours, making it today’s weakest performer among the top 10 most valuable cryptoassets by market capitalization on tracking site CoinGecko’s ranking.

Despite this weak performance, however, SOL has maintained its place in the top 10, which it has entered earlier this week. The price is now up 72% for the past 7 days, and close to 200% for the past 30 days. This makes it the best weekly performer among the top 10.

Today’s price move follows news that the DeFi protocol Luna Yield and its associated social media platforms, have all been taken down. The news was first shared by the Solana-based launchpad SolPAD Finance earlier on Friday, saying that they “still can’t reach Luna Yield,” despite attempts to figure out what has happened.

SolPAD further elaborated on the situation in their own Telegram group on Friday morning, indeed calling the event a “rug pull” – a form of exit scam by developers in DeFi – and saying that “it makes an enormous impact on investors and SolPAD community.”

With the Luna Yield team now gone, more are getting suspicious and calling it a malicious rug pull, with some members of the Solana community even launching their own investigations into the case. If it indeed were a rug pull, it would reportedly be the first of its kind on Solana.

Moreover, suspicions of rug pull grew further after CoinDesk had reported that an anonymous source had said that USD 6.7m in assets had been taken. “The funds are already gone, and no way to get them back […] They moved all from SOL to ether and then to the decentralized tornado cash service,” the source reportedly said.

The massive gains seen over the past week for SOL came as the Solana network has seen increased traction in the non-fungible token (NFT) space, most recently with the launch of the “Degenerate Ape Academy” this past Sunday. The project, which did receive some criticism for a launch that was said to be “shitty at best,” has by now sold NFTs worth some 157,700 SOL (USD 11.3m), according to tracking site Solanart.io.

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