Incident Overview
The founder of My Big Coin was found guilty of fraud with cryptocurrencies. In the course of the fraudulent scheme, the founder misappropriated more than 6M USD of investor's funds for personal gain and expenses on goods worth hundreds of thousands of dollars.
MY BIG COIN is a Cryptocurrency with Blockchain, wallet and platform where merchants and consumers can process transactions.
Crater - owner of MBC, preyed on investors and offered them false opportunities in the expanding cryptocurrency market in order to extort millions of dollars from them for personal use.
He founded MBC in 2013, offering virtual payment services using the fraudulent digital currency “My Big Coins”, which he sold to investors between 2014 and 2017. Using false ideas about the nature and value of the coins, Crater and its partners falsely claimed that the coins were backed by gold, oil and other valuable assets worth $ 300 million. Crater also falsely informed investors that My Big Coin was partnering with MasterCard and that the coins could be easily exchanged for government-backed paper currency or other virtual currencies. Crater made these distortions public through social media, email, and text messages.
In fact, the coins were not backed by gold or other valuable assets, and the partnership with MasterCard is just another lie. During this scheme, Crater misappropriated more than $6M of investor's funds for his personal benefit.
Incident Report
Protocol Information
Market Context at Time of Hack
What the Attacker Needed to Succeed
Understanding the prerequisites for this type of attack helps auditors identify protocols that are most at risk and helps developers build better defenses.
What Auditors Should Check
If you're auditing a protocol with similar architecture to My Big Coin, these are the critical security checks that could have prevented this incident (July 2022).
- Verify all logic paths related to Rugpull are guarded by proper access controls and input validation
- Review privileged functions (owner, admin, governance) for potential abuse vectors - centralization risks should be documented and bounded with timelocks or multi-sigs
Master these auditing techniques with hands-on labs and real exploit scenarios in the Smart Contract Hacking course.
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