12/20/2025
A rug pull is a crypto scam—common in DeFi and NFT projects—where developers create hype around a token or project, attract investors, and then suddenly withdraw all the liquidity or funds, causing the asset’s value to collapse to near zero; this is typically done by removing liquidity from a DEX pool, minting and dumping large amounts of tokens, exploiting hidden admin functions in smart contracts, or abandoning an NFT project after mint, and common warning signs include anonymous teams, unlocked or unverified liquidity, unaudited contracts, unrealistic return promises, extreme token concentration in dev wallets, and selling restrictions, which is why it’s called a “rug pull”—because the financial support is pulled out from under investors without warning.
