What is Rugpull and How a Boy Fooled Everyone and Made $30k ๐ฐ
Rugpulls are a common scam in the crypto world, especially in meme coins. Here's how they work and how one scammer made a quick $30k! ๐๐จ
What is a Rugpull?
A rugpull is when the creators of a coin withdraw all liquidity from the trading pool, leaving investors with worthless tokens. Itโs like having the rug pulled out from under you. ๐ฅ
How a Rugpull Works:
1. Creating the Coin & Building Hype ๐ข
The scammer creates a meme coin, often with a catchy name, and promotes it heavily on social media. They build a community through influencers, bots, and fake testimonials. Investors are drawn in by promises of massive gains. ๐
2. Adding Liquidity ๐ธ
The scammer adds liquidity to make the coin look legitimate. This helps maintain the price, making investors feel safe. New investors join, boosting the price.
3. The Pull โ Goodbye Liquidity! ๐จ
Once enough people are invested and the price rises, the scammer withdraws all the liquidity from the pool, causing the price to crash. Investors are left with worthless coins.
4. Exit Strategy ๐โโ๏ธ
The scammer disappears, deletes their profiles, and vanishes with the profits, leaving investors with nothing.
Why Rugpulls Work:
Greed & FOMO ๐ค: Investors rush into meme coins, driven by fear of missing out on big gains.
Lack of Research ๐: Many investors donโt fully research the project or team behind the coin.
No Accountability ๐: The scammer can create a coin and disappear before anyone can recover their funds.
How to Avoid a Rugpull:
1. Do Your Research ๐: Look into the team behind the coin. Are they verified? Do they have a track record?
2. Check Liquidity ๐ง: Ensure the coin has enough liquidity, and avoid coins where the creators control it.
3. Avoid Unverified Coins ๐ซ: Stick to coins with clear roadmaps and trusted audits.
4. Donโt Invest What You Canโt Afford to Lose ๐ธ: Remember that meme coins are high-risk investments.
