Great info

A "rug pull" in the cryptocurrency world refers to a scam where developers or insiders abruptly withdraw liquidity from a project, often leaving investors with worthless tokens. This is a common fraud in decentralized finance (DeFi) platforms and often occurs in the following ways:
Types of Rug Pulls
1. Liquidity Theft: Developers remove liquidity from decentralized exchanges, making it impossible to trade the token.
2. Dumping Developer Tokens: Insiders create and heavily promote a project, then sell off their pre-allocated tokens once the price rises, causing a crash.
3. Malicious Code or Backdoors: Developers program a smart contract with code that allows them to seize funds later.
Common Signs of a Potential Rug Pull
Anonymous Developers: Teams without verifiable identities.
Unrealistic Promises: Projects offering extremely high returns with no clear mechanism.
Poorly Written or Opaque Whitepapers: Vague or confusing documentation.
Locked or High-Percentage Tokens for Developers: Developers holding a significant portion of the supply.
No Liquidity Locks: Absence of mechanisms to lock liquidity, allowing developers to withdraw funds.
Prevention Tips
Research the Team: Verify developer credentials and project partnerships.
Check Liquidity Locks: Look for smart contract mechanisms ensuring liquidity remains untouchable for a set period.
Analyze Smart Contracts: Have the code audited by a reputable third party.
Avoid FOMO: Don’t rush into investments based on hype.
If you suspect a project is a rug pull, avoid investing and warn others in the community.