Cryptocurrencies have long been a breeding ground for scammers, but when you add in the current NFT craze you get the perfect combination of massive interest and completely untraceable anonymous payments that can lead to a lot of people losing a lot of money.
Evolved Apes Inc. is a project that got started as 10,000 NFTs (Non-Fungible Tokens for the uninitiated) that were all basically variations on the same theme: apes. You got apes with brass knuckles, apes holding guitars, punk apes, ninja apes, samurai apes, apes in tank tops, apes in bathrobes--you name, there was an ape for it.
The project was supposed to help fund a new fighting game where players could own, trade, and fight using their own specific apes. People invested millions of dollars into the project, but now all that money is gone after the project owner absconded with everyone’s investment.
The Evolved Apes project got started on September 24 headed up by an anonymous figure known only as Evil Ape. That probably should have been everyone's first red flag, but according to a report from Vice, that didn't seem to stop people from sinking $2.7 million in Etherium once the NFTs went on sale.
A week later, Evil Ape took down Evolved Apes' Twitter and website. They also took the entire $2.7 million USD that had been intended to continue the Evolved Apes project and fund the tie-in fighting game. A classics "rug pull" scam.
Mike_Cryptobull, one of Evolved Apes investors with around $10,000 invested in 20 NFTs, told Motherboard that several warning signs appeared in the days leading up to Evil Ape's disappearance, including a lack of payment to artists and a social media competition where the winners didn't receive their promised NFTs.
“What has happened is that Evil Ape has washed his hands of the project taking away the wallet with all the ETH from minting that was to be used for everything, from paying the artist, paying out cash giveaways, paying for marketing, paying for rarity tools, developing the game and everything else in between,” Mike said.
Despite the setback, the Evolved Apes community intends to continue with the project. Evolved Apes are still being traded on OpenSea, an NFT trading site, even after the scam has been made public. However, since 4% of every sale gets sent to Evil Ape, the Evolved Apes community plans to start a new project called Fight Back Apes using the same art assets as the original NFTs.
However, this time they’ll make the Ethereum wallet require multiple signatures so nobody can just walk away with all the money.