Rug Pull

Developers launch a token, often with heavy promotion, and pair it with funds in a trading pool so that others can buy and sell. Once enough money has flowed in, they drain the pool, dump their own large holdings or switch off selling in the code. The price falls to almost nothing within minutes. A “hard” pull is built to steal from day one; a “soft” pull happens when the team simply stops work and sells. The older term exit scam covers the same idea outside crypto, where a platform collects deposits or prepayments and then shuts down. Pseudonymous wallets and unregulated venues make recovery rare, though investigators can follow the withdrawn funds with blockchain analysis. Practitioners meet it in investor complaints, bank alerts on crypto purchases and fraud typologies. Buyers rarely recover anything, so exchanges and banks screen for launch patterns before customers send money.

A small team launches a token promoted through social media, with a pool that looks locked. Over two weeks, retail buyers put in about 2 million. One night the developers, who kept a hidden control right in the contract, withdraw the pool and sell their allocation. The token falls 99% within the hour, the website and chat group vanish, and a bank sees several customers reporting the same loss.