Rug pull

A rug pull is a type of scam in the cryptocurrency and DeFi space where project creators suddenly withdraw their funds or shut down the platform, leaving investors with worthless tokens. This often happens on decentralized exchanges (DEX) and DeFi projects, where developers attract users with promises of high returns and then remove liquidity pools or restrict access to funds.

Rug pulls can take various forms, such as manipulating smart contract code, changing project rules without warning, or developers dumping large amounts of tokens, causing their value to plummet. To avoid such scams, investors should research projects, check for code audits, and be cautious of those where developers remain anonymous and have full control over funds.