Vitalik Rug Pulling Dog Tokens: A Hero? Or did he stir up a Hornet Nest?
Last week, Vitalik Buterin chose violence. Not with words and shit posting as crypto Twitter is so accustomed to, but through action.
This time, he set his cross-hairs on SHIB and a variety of Dogecoin-inspired meme coins.
So, he decided to go for the jugular and do what meme coin creators couldn't expect from the Ethereum founder.
Vitalik aimed for their hearts, and the dagger went right through, literally tanking the tokens’ valuation and liquidity.
The events of May 12 unfolded like a movie. Scripted? Nah. Vitalik Rugggeeeed SHIB! It was unbelievable.
The Ethereum co-founder created instant enemies by dumping their donations and donating proceeds to the India COVID-19 Relief fund.
He's now being loved—described as a "sick" legend by protagonists-- and loathed by the afflicted.
However, War on Rugs—a telegram group who ironically hate rug pulls—are crying foul on behalf of SHIB token investors. They now want revenge, retaliating since they believe Vitalik’s actions were detrimental to innocent investors.
They fully understand that the task ahead may be insurmountable, but they know where it pains the most for Ethereum folks and especially the co-founder.
When the dust had settled, Vitalik had withdrawn roughly $56 million or 13,500 ETH, removing 100 percent of SHIB’s liquidity on Uniswap.
What’s more, the remaining 50.6 trillion of illiquid SHIB tokens worth over $1 billion (at that time) were sent to the fund.
Quite the benevolent act, and people would have a soft spot for him since the money went to charity.
The question is: How will the creators of the fund sell the illiquid and hammered SHIB tokens?
The same question is being asked by SHIB holders and a majority of the crypto community.
Still, to get back to Vitalik and avenge for his alleged “misdeeds,” the Rug Ethereum $RETH drama token is now live on the Binance Smart Chain (BSC) and trading on the Uniswap copy, PancakeSwap.
The objective is simple: Rug ETH and boost BNB prices.
By doing this, they hope to pile more misery on Ethereum, a platform presently choking with high Gas fees and slowly being killed by miners.
RETH isn’t an “ordinary meme token.” Instead, it would be incentivized. Beyond fee distribution to RETH holders, a portion of fees would be used to borrow ETH from Venus and dumping the coin for BNB at a low-risk ratio.
Traders of RETH would contribute to this “final retaliation” by trading in and indirectly pumping BNB and dumping ETH.
Their action may be impassioned, and many are full of sour grapes for sure, but we must look at what preceded this rug pull.
Ethereum miners may be “killing” the network by only accepting higher bids and exploiting the loophole in the current first-come auction mechanism.
However, we must also not forget that block utilization remains at over 99 percent, according to data from Etherscan. The competition for immediate transaction confirmation is high.
The problem is, the primary source of this needless competition was due to the proliferation of the dog meme coins who wanted to replicate the success of Dogecoin.
From late April to early May, these puppies were nothing but nuclear explosions. 13X gains were not out of the ordinary, causing innocent investors to purchase duds listing for below one cent aggressively.
Prior to the frenzy, attempts had been made by increasing the block Gas limit to 15 million—a consensus that miners agreed to since it directly benefits their bottom line. Then Dogecoin soared, and several dog meme tokens were minted, clogging the network and forcing Gas to over $60—the highest since Ethereum launched.
Therefore, supporters claim the Rug was justified for the sake of Ethereum and network users—not just DeFi.
Second, “War on Rugs,” the creators of RETH, had noted a vulnerability in the Shib Inu token earlier on. They discovered that Vitalik Buterin had a huge stake in SHIB, and this was a weakness that came to haunt them on May 12.
The bad thing is that Vitalik didn’t actually ask for any of these tokens.
Instead, in their wisdom, creators of these intensive projects, minted quadrillions of tokens and sent a majority to Vitalik to create this illusion that Vitalik endorses them and that VITALIK (a Monk caring less for what money can buy) WOULD NEVER TOUCH THEM. It’s crazy that Vitalik had control of these projects at any time. holding roughly 50 percent of the total supply.
By liquidating a big chunk of these tokens—and doing the unexpected, Vitalik opted to save technology and right away give SHIB, AKITA, and others his back. According to many observers, this was the first attempt to help dump down Gas fees that were skyrocketing as a wave of alleged scam tokens flew in Ethereum like a deluge.
Gas eventually dropped over 80 percent to around $20 early this week.
Over 9,800 RETH holders are hurting and seeking revenge.
Did Vitalik f*uck up?