Robinhood Chain scams are already costing users dearly

Robinhood (Nasdaq:HOOD) launched the public mainnet of its new blockchain on July 1, and unfortunately, tons of people are already losing money trading its coins. Bad actors are using a variety of scam contracts, memecoin rug-pulls, phishing links, and garden variety theft, leading to complaints of loss flooding onto social media.

Relay Protocol warned about scam tokens on the new Robinhood Chain: “If you bought one, the funds you spent are unfortunately gone.”

In this example, scam contracts are accepting a token swap, briefly crediting the buyer’s wallet yet immediately transferring the tokens back to the deployer’s wallet. In other words, users unwittingly purchased tokens for someone else.

Another trader alleged that Robinhood Wallet’s default sell screen auto-populated a Robinhood Chain scam coin called USER. Unless someone modified that default, the position would vaporize. “$600 out the window in seconds,” complained the user. 

Another trader swapped ether (ETH) for a poisoned memecoin named $ROBINHOOD inside their Robinhood Wallet. The instant the swap confirmed, tokens moved to an unauthorized wallet.

Wallet drainers and fake token scams

A collector of NFTs claimed an OpenSea swap of Robinhood Chain assets sent his coins to an unauthorized address, costing him $350.

A trader tagged Robinhood CEO Vlad Tenev after losing $50 to what he called scam transactions.

An AI-branded Robinhood Chain memecoin, HOODIE, halved in price in a single afternoon.

Read more: Read this before you click on any Robinhood email

“It is absolutely crawling with wallet drainers and fake token scams right now,” warned another researcher, alleging that a holder of CASHCAT lost $56,000 to a hacked smart contract on Robinhood Chain. 

Someone else asked whether Robinhood Chain had gone full rug mania. Another observer estimated thousands of users losing money bridging over assets from Solana-based PumpFun.

A researcher posted that memecoins account for more than 75% of the last two days of Robinhood Chain trading. That is not a good statistic, as a general rule, due to almost all meme coins trending toward $0 eventually.

“ROGE on Robinhood Chain is a 100% honeypot. ​The contract has a backdoor,” warned another trader. 

Clifford asked a wallet provider to enable revoke-approvals on Robinhood Chain to help users undo their smart contract authorizations.

Another user urged traders to audit smart contracts prior to authorizing in the first place.

Protos previously tracked losses on branded memecoins and the near-total mortality rate of Pump.fun token launches. The long-term performance of most speculative digital assets like NFTs is identical.

Robinhood Chain’s permissionless architecture replicated many of those conditions and created an environment ripe for scams.

The new Robinhood Chain is nine days old.

After publishing this article a Robinhood spokesman contacted us and told us: “The Robinhood Wallet integrates with Blockaid to both provide scam warnings on known or suspected scam tokens and filter out tokens that return a malicious rating from Blockaid. Robinhood Chain is permissionless. This is a common issue across permissionless chains. It’s not specific to Robinhood Chain.”

UPDATE 11 Jul, 07:04 UTC: Included a comment from Robinhood spokesman.

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