Rug Pull
A rug pull is a crypto scam where developers abandon a project after draining funds, whether by selling their tokens, removing liquidity, or exploiting smart contract backdoors.
Understanding the Concept
Rug pulls have stolen billions. Some are obvious (anonymous team, copy-paste code); others are sophisticated (doxxed founders, audited contracts—then surprise backdoor). Red flags include: locked liquidity you can't verify, token distribution where insiders hold huge percentages, and "mint" functions that let developers create unlimited tokens. Always check: Is liquidity locked? What's the token distribution? Is the contract verified and audited? Who's the team? Even then, rugs happen. Never invest more than you can afford to lose in new projects. The profit potential attracts both innovators and scammers.
Real-World Example
A new DeFi project launches with 100% APY yields. TVL grows to $50 million. One night, developers use an unaudited contract function to drain all liquidity. Token crashes 100%. Users are left with worthless tokens.
How Strykr Helps
Strykr tracks Rug Pull developments across the crypto ecosystem. Our AI provides real-time insights and alerts to help you navigate the market with confidence.
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