Glossary
What is a rug pull?
In one sentence
A rug pull is when a project's creators abandon it and take investors' money — typically by draining liquidity or dumping their own token supply.
A rug pull is an exit scam. Developers launch a token, build enthusiasm, attract buyers, and then remove the value. The two usual mechanics are withdrawing the liquidity that makes the token tradeable — leaving holders with something they cannot sell at any price — or selling a large insider allocation into whatever demand exists.
Some are technical rather than sudden: contracts written with a hidden function letting the creator mint unlimited tokens, or block everyone else from selling. These “honeypots” let you buy and then quietly fail when you try to exit.
Warning signs. Anonymous team with no verifiable history. Most of the supply held by a few wallets. Liquidity not locked, or locked briefly. Guaranteed or unrealistic returns. Heavy paid promotion with countdowns and urgency. A contract that is unverified or that nobody independent has reviewed. Aggressive dismissal of anyone asking about token distribution.
Any one of these warrants caution; several together are close to conclusive.
For example
"Liquidity locked for 30 days" means the rug can be pulled on day 31.