DegenTown, a Solana collection with no roadmap and no discord, launched on Magic Eden's Launchpad at the end of July. Their stealth mint was heavily promoted by Magic Eden's Twitter account, leading some to believe that the project was endorsed by the marketplace.

Magic Eden Tweeting about DegenTown before their mint.

But problems with DegenTown emerged soon after mint, starting with the artwork reveal getting delayed. Much worse, however, was when the project's official Twitter posted a link to a wallet drainer on July 11th. The team claimed that their Twitter account had been hacked, but since their project didn't have a discord, getting word out about the hack was slow. Many people had their wallets drained as a result of interacting with the malicious link.

In the wake of the alleged hack, the DegenTown team promised to issue refunds to victims affected by the wallet drainer, but those refunds have yet to materialize.

Yesterday, Magic Eden released an announcement about DegenTown. In a Twitter thread, the marketplace said that they had been working with the original founders and urged them to return the funds raised by the project. According to Magic Eden, only one of the founders (0xLerk) had returned funds. While NFTRamo claimed to have only been an advisor to the project, Magic Eden named him as a co-founder of DegenTown and said that they were "appalled" by his behavior and "regret working with him."

In April, an NFT project founded by NFTRamo, The Habibiz, suffered a similar attack when his discord account was hacked and posted a wallet drainer link in the project's discord.

NFTRamo recently hinted at launching a new free mint project, which was met with skepticism on Twitter.

Magic Eden announced that they have contracted a third-party to analyze the amount lost in the DegenTown wallet drainer attack. Once the analysis is completed, the funds returned by 0xLerk will be used to reimburse victims. The marketplace also said that all fees they collected from DegenTown sales would be used to create a scholarship program for NFT artists and creators. Additionally, Magic Eden is advising the new owners of DegenTown.

Going forward, Magic Eden will "keep marketing benefits more consistent across Launchpad projects" to avoid the impression that some projects are endorsed by their launchpad. They will also require advisors to dox themselves to the launchpad, a requirement that was previously only in place for project founders.

You can read Magic Eden's full announcement here.

Great! You’ve successfully signed up.
Welcome back! You've successfully signed in.
You've successfully subscribed to Minted.
Your link has expired.
Success! Check your email for magic link to sign-in.
Success! Your billing info has been updated.
Your billing was not updated.