What is Rug Pull?

Question

What is Rug Pull?

Accepted Answer

A **Rug Pull** is a malicious maneuver in the decentralized finance (DeFi) ecosystem where cryptocurrency developers abruptly abandon a project, draining all liquidity from the decentralized exchange (DEX) pool and leaving investors with worthless tokens. This exit scam is a significant risk in the volatile world of new crypto projects, particularly those involving newly launched tokens and low-cap assets.

Rug Pull

What is Rug Pull?

What are the primary mechanisms and technical types of a crypto "Rug Pull" scam?

How can investors effectively identify and avoid potential "Rug Pull" projects in the DeFi space?

What is the current legal and regulatory recourse for victims of a "Rug Pull" scam?

How does a "Rug Pull" technically differ from a legitimate project failure or a "Pump-and-Dump" scheme?

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