What is Exit Scam?

Question

What is Exit Scam?

Accepted Answer

An **Exit Scam** is a form of financial fraud in the cryptocurrency and Decentralized Finance (DeFi) space where the developers or founders of a project, exchange, or investment scheme abruptly cease operations and abscond with all investor funds, often after a period of aggressive promotion and accumulation of assets. This act, frequently referred to as a "rug pull" in the DeFi context, represents a deliberate, pre-meditated theft that exploits the trust and capital of participants, leading to catastrophic financial losses.

Exit Scam

What is Exit Scam?

What is the technical mechanism of a cryptocurrency Exit Scam, and what are some notable historical examples?

How do Exit Scams financially impact the broader cryptocurrency market and investor confidence?

What are the key technical red flags and due diligence steps to prevent falling victim to an Exit Scam?

How are global regulatory bodies, such as the SEC and CFTC, responding to the rise of cryptocurrency Exit Scams?

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