According to a social media post on September 28, the official channel of decentralized exchange (DEX) Pond0X said it has reached a total trading volume of over $100 million.
Pond0X previously caused many investors to lose more than $2 million when it launched its native token PNDX, because it had a function that allowed anyone to transfer without the owner’s permission. But advocates say these losses are not the developers’ fault.
As evidence of trading volume, Pond0X cited the Dune dashboard created by user Mogie, which showed trading volume of over $111 million as of September 29.
PNDX token launched on July 28. At the time, critics accused the project of being a rug pull or an exit scam. The problem is the unorthodox way in which the project’s founder, Jeremy Cahen (also known as “Pauly”) launched PNDX. In the launch post on X (formerly Twitter), Cahen posted a URL to an app that allows people to send a fixed amount of ETH to receive a fixed amount of PNDX. Cahen also posted the contract address for the token.
In response, some investors started buying PNDX on Uniswap, using its contract address for identification, while others deposited ETH into the app to receive PNDX. The price on Uniswap quickly rose above the ETH needed to mint PNDX, so mints began selling for a profit. Critics claim that this process transferred more than $2 million in PNDX from those who bought on Uniswap to those who minted it. ETH sent through the app went into a contract with no means of getting the funds back, leading critics to accuse the entire project of being aimed at withdrawing funds from investors and sending them to Cahen.
Additionally, cryptographic experts began claiming that PNDX lacked the usual transfer functionality. Instead of just allowing owners to transfer, PNDX allows anyone to transfer, meaning each owner can lose their funds at any time, as any programmer can “ steal” their PNDX using developer tools. On July 29, Solidity enthusiast and blogger Sm-stack announced they had run a test in Foundry to prove this point.
However, more than two months after the project’s launch, it continues to attract hundreds of supporters on Twitter, with replies to official posts as frequent as saying “feels like a good project”. ” and the saying “Best DEX, don’t see a reason for anyone to use it”.
On July 29, trader and blogger Antony Williams claimed to have read the app’s smart contract code and determined how it works. According to Williams, Pond0x is “basically an LP Farm” and not an outright scam. The application issues each user an ID to identify the user’s share of the Pepe token pool. Users can increase the Pepe bonus they are entitled to by calling the “BribeforLevelUp” function. To use this function, users must deposit 0.26 ETH to purchase Pepe tokens, which are then deposited into the pool to pay rewards. The exchange also gives “Points” to each user. Higher scores represent more potential rewards from transaction fees earned, all other factors remaining constant.
Williams did not say these rewards could be claimed immediately but confirmed the developer “may” intend to pay them out at some point in the future. Williams also claims the PNDX token is “essentially worthless,” likely created this way “to avoid legal complications.”
The project launched the Pond0X exchange on September 1. According to the Dune dashboard, Pond0X has now reached over $100 million in trading volume, showing that at least some traders are undeterred by criticism.