GlossaryBeginner
Rug Pull
A scam where a project's creators abandon it and take investor funds with them.
A rug pull is a scam in which a project's creators abruptly abandon it, often after draining funds from a liquidity pool or otherwise taking investor money, leaving participants with a worthless or illiquid token.
Rug pulls are a recognized risk specifically associated with newer, less established projects that haven't been reviewed or audited, and where the creators retain significant control over funds or contract code.
Examples
- A token whose liquidity is suddenly removed by its creators, crashing its price, is a common rug pull pattern.
- Reviewing whether a project's contract and liquidity are locked or controlled by anonymous creators is one way to assess rug-pull risk.