How Rug Pulls Work in Crypto: A Guide to Avoid Scams

[{"selector":"#anim-a1631656-b878-4393-8973-2638b98f92cb [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 24.998501642105627%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-a4364070-ac9f-4907-8e06-6d34d0861aa8","keyframes":{"transform":["translate3d(-99.03847%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e5e2a7f0-881f-469c-9d26-2b798d435cd8","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-195f134c-0d6f-4b23-a9c7-4a6d847d5362","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] A rug pull is a type of scam where the developers of a cryptocurrency project suddenly withdraw all their funds from a liquidity pool, leaving investors with worthless tokens

[{"selector":"#anim-56fda015-7d17-4d9c-a542-71ac626773fe [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-6.59340660522232%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-2e76a360-fc3e-48e7-ad40-41bf47c19a61","keyframes":{"transform":["translate3d(-100%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-da4dd8b3-0a84-4b78-95d0-e3198028b6f4","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-c1d93ec8-a9ce-4cf5-9d6f-4dc9a8b6305d","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] 1. The Setup: A new cryptocurrency is launched through ICO or a decentralized exchange & they typically try to build trust by creating professional-looking websites

[{"selector":"#anim-38d84edb-d87a-434d-83f2-8bc74cd5eca5 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-2.3261942181179656%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-4f920e0d-80d5-4944-a88a-763b034a8a4d","keyframes":{"transform":["translate3d(-99.04762%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-d835f2db-bbe4-4c5f-921a-bce7d9b3bc70","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-cc98a36f-6a0d-4639-a22c-42e3b2c417ff","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] 2. The Pump: They promote the token through various channels to draw attention and often add liquidity to decentralized exchanges

[{"selector":"#anim-9785b915-67d5-4c7b-ab6d-3d879b757814 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-25%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-244ef7f7-4926-4539-a6e3-88436a4c0b29","keyframes":{"transform":["translate3d(-100%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-8df9479d-f11e-4e77-82b9-529ead57fea7","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-3ca99ce4-2268-4ed3-a6e2-d00347541421","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] 3. The Pull (The Scam): Once the price has been inflated, they withdraw the liquidity from where the funds are stored. Without liquidity, users can no longer sell their token & it becomes worthless

[{"selector":"#anim-bfa1d662-8c42-4c79-b7a2-63611b035559 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(1.4033264011068383%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-611cf6f6-c1ae-4ba9-b129-3f9e999cc553","keyframes":{"transform":["translate3d(-100%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-8db43c96-1cfb-47a4-8824-7656a66200d1","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-1a0fd467-5f31-423d-b8b2-0944d6eed5c0","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] 4. Aftermath: The investors who bought the tokens can no longer sell or trade them, and the developers will vanish

[{"selector":"#anim-8aa4f6ab-89f1-4884-b44b-bfaaedaa8d5e [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-23.733432228025606%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-9e6586af-9c88-4943-8a16-d0821e41fd5e","keyframes":{"transform":["translate3d(-100%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e5f20aef-37ad-40d7-8ebf-d80d9ac5b39e","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-b79e96ef-e7bc-47ec-bc1a-ee50e329f2f9","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] Key Indicators of Potential Rug Pulls: - Anonymous Teams - No Transparency - Unusual Tokenomics - Fast Promises of High Returns

[{"selector":"#anim-758ff109-0203-4b41-9135-7361eb5522a9 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-1.3602328624244002%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-a10e19ad-3143-4ff0-b7c4-8a99f4a284d9","keyframes":{"transform":["translate3d(-100%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-7eec236f-7df6-4ee6-92c6-14507f54335f","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-7f012b4e-f0c6-4e54-8875-9532fbbfedbd","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] How to Protect Yourself - Research - Audit - Be Skeptical - Avoid FOMO

[{"selector":"#anim-eabadcd1-6e2a-4c29-8615-067f91550eb4 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(-25%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-24e70903-fbf2-459a-86b9-4a6a45bdb23b","keyframes":{"transform":["translate3d(-101.2285%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-3a1db0a3-ebea-4828-b90c-6c88d5642722","keyframes":{"opacity":[0,1]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-44de3052-0fe0-43a3-8a83-e1c3df135e78","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":100,"duration":2000,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] Conclusion: Staying informed and cautious is crucial in the crypto space to avoid falling victim to rug pulls and other scams. Learn more