The crypto space is full of innovation… but also full of traps. One of the most damaging scams is called a rug pull — and it has drained billions from unsuspecting investors.
📌 What is a Rug Pull?
A rug pull happens when the team behind a crypto project suddenly withdraws liquidity or abandons the project, leaving investors with worthless tokens.
The term comes from “pulling the rug out” from under someone.
⚠️ Types of Rug Pulls
1. Liquidity Rug
Developers remove all liquidity from a trading pool, making it impossible to sell the token.
2. Code Exploits
Hidden functions in smart contracts let the creators mint unlimited tokens or block selling.
3. Abandoned Project
The team stops all development and disappears from social media.
🔍 Red Flags to Watch For
Anonymous Team – No verifiable history or LinkedIn profiles.
No Audit – Smart contract hasn’t been reviewed by a trusted auditor.
Unrealistic Returns – “1000% APY” is a major warning sign.
Low Liquidity & Volume – Easy for devs to pull the plug.
No Real Utility – Token exists only for speculation.
💡 How to Protect Yourself
Research the team’s background.
Check for smart contract audits from reputable firms.
Avoid FOMO into tokens that pump too quickly.
Use platforms like Token Sniffer or DEXTools to scan contracts.
Diversify — never put all your funds into one project.
Final Thought:
In crypto, security starts with you. Spotting red flags early can save you from financ
ial loss — and from becoming another statistic in the rug pull scam list.