MetaMask, a popular online Ethereum wallet available as a browser add-on, has recently blacklisted ETH’s most popular decentralized application (dapp) and labeled it an “active scam” that was phishing users.
The move, first spotted by The Next Web, sees users who use MetaMask and head to 333ETH’s address receive a warning message about the app, which claims their security could be at risk as the app “tested positive on the Ethereum Phishing Detector,” which includes malicious and compromised websites.
Given the warning users are currently unable to use the website using MetaMask. Its developers have clarified they’ll be adding an ability to bypass the block, as they have “no intention of promoting censorship.”
This site was never the most used Dapp, and it was actively phishing people. We will be adding the ability to skip our block page, we don't mean to tell people what they can visit, but this site is an active scam.
— MetaMask (@metamask_io) September 27, 2018
333ETH is widely believed to be a Ponzi scheme. The app markets itself as an “ETH cryptocurrency distribution projects,” that promises investors lifelong returns of 3.33% a day. It claims investors are ensured of the “security of [their] contributions and life-long payments guaranteed by the Ethereum blockchain.”
As CryptoGlobe covered, the dapp was built using a smart contract-based algorithm that supposedly ensures its creators can’t access or modify it. The number of red flags surrounding it saw StateofTheDapps warn against it.
The dapp’s “business model” sees the contract automatically deduct 11% of every investment for marketing services, 2% for “payroll,” 1% to fund transactions fees, and an additional 3% for “technical support.”
Notably, 333ETH is Ethereum’s most popular dapp. According to StateofTheDapps, it had over 1,700 users in the last 24-hours, and has distributed over 13,600 ETH ($3 million) through its smart contract. This means it’s more popular than Ethereum’s top decentralized exchanges IDEX and ForkDelta.
Platforms like these are abundant in the cryptocurrency ecosystem. Earlier this year a well-known Ponzi scheme called BitConnect collapsed after regulators in the US issued cease and desist letters against it.
For those out of the loop, BitConnect claimed to have a trading bot that guaranteed users a daily profit on their investments. It had a token called BitConnect Coin used for investments, that reached an all-time high above $400. After the scheme collapsed it lost all its value, and is currently not even traded on exchanges.
On GitHub, various users claim 333ETH is paying them regularly, which is expected in Ponzi schemes as these payments help spread the word and bring in new users. Once new investments stop being enough to pay users, these schemes collapse.
