Has the Rug Been Pulled on Shroom Finance as Tokens Dump 27%?
Not a day has gone by in recent weeks without a new DeFi food flavor having a moonshot as ‘degen’ farmers chase the latest yield pool. Today it is Shroom Finance on the back of recent NFT fever.
Shroom Finance is aiming to build a decentralized ecosystem for in-game asset trading and minting though the issuance of non-fungible tokens (NFTs).
Bridging Gaming and Crypto
NFTs are a special type of token on the Ethereum network primarily using the ERC-721 and ERC-1155 standards to create verifiable digital scarcity. They have surged in popularity recently on the back of a burgeoning digital art scene.
According to research, the gaming industry is expected to surpass $200 billion in 2023, with video game assets trading well over $50 billion per year. Shroom Finance plans to leverage this in order to enable the issuance/minting, launching, and trading of these digital assets with unprecedented ease.
It also aims to bridge the gaming world and crypto industry;
“Game developers tapping into DeFi liquidity, capital and Yield Farming minting processes, and DeFi LPs/farmers supporting, driving and owning in-game economies.”
A recent Delphi Digital report has labelled the project as ‘compelling’ with a lot of room for potential and Shroom Finance token prices are moving as a result of the heightened activity surrounding the platform.
SHROOM Rug Pull?
A number of high profile crypto traders and analysts, such as Josh Rager, have been actively plugging the platform recently which has clearly contributed to the token price surge;
Every time people sell big on $YFL and $SHROOM they just end up pumping again
You'd think they would learn by now – there is a lot more in the pipeline for both that will bring tremendous value to this market
That's why I share – both are longer-term holds for good reason
— Josh Rager ???? (@Josh_Rager) September 30, 2020
When asked if SHROOM had the potential to reach $1, Rager replied;
“In my opinion, it’s an “of course it does”. Especially after Gameswap release next month”
Crypto analyst ‘IncomeSharks’ has noted a parabolic move on the charts which could be indicative of a ‘rug pull’, which is the DeFi term for a pump and dump.
$SHROOM has gone parabolic. I'm eyeing $.30 as a top. Pumps like these aren't immune to rug pulls and telling yourself "this one is different" is a dangerous game. Will be glad to be wrong but this is how I see it unbiased. pic.twitter.com/bo0QWkdzc0
— IncomeSharks (@IncomeSharks) October 1, 2020
Over the past five days, SHROOM prices have surged 165% from around $0.104 to top out at $0.275 yesterday according to Uniswap.info.
Today they’re dumping in what appears to be that ‘rug pull’ resulting in the loss of 27% in just a few hours down to $0.20.
This type of action has become the norm for tokens from anonymously founded, unaudited DeFi protocols which are largely driven by hype. The same thing happened with SushiSwap and its tokens are now 88% down from their peak.
Shroom Finance does have a unique concept that should be a winner, in the long run, providing the whales and yield jumpers can stay still for a while.
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