While it is true that with the advent of decentralized finance (DeFi) everyone has been given the opportunity to create their own pools independently, as happens on Uniswap, giving value to their token by putting as collateral Ethereum (ETH), not everyone knows that Liquidity Pools are often subject to scam. For example, liquidity can be withdrawn.

In fact, considering that DeFi is experiencing a real explosion both for projects and the millions of dollars blocked, the industry has started to attract the rottenness of society and criminals have devised different strategies to scam the victims.

Unfortunately we are witnessing a sophistication of the attacks by criminals. For example, one of the strategies to scam users is to create fake tokens of original projects and list them with liquidity pools on DEX as Uniswap, misleading those who buy a token completely fake but with the name of a real and famous project.

Another problem, more complex to discover, is the one related to backdoors created directly in the smart contract code of a project. When this happens, once the bad guys put their assets in the pools, they can have their funds stolen because the criminals can close them and steal the cryptos from them. In this case the practice of yield farming is exploited, which gives tokens if you provide liquidity to a certain pool.

The nth scam relative to the liquidity pools

But now there is also another trap.

As pointed out by several users, in fact, there is a system called rug pull. In practice, those who put liquidity in the pool can at any time withdraw it and get a not indifferent advantage, but leaving users with a token that becomes worthless.

Also here it is necessary to be very careful and to be wary of pools that do not have the liquidity blocked because they could be susceptible to attacks of this type.

Finally, we remind you that as the tools in the DeFi field advance, tools sometimes suitable only for insiders because of their complexity, you have to be careful with the new techniques used for attacks and keep your eyes always open.

Negative aspects and scams of Liquidity Pool