A Rugpull is a type of fraud in the crypto world where a developer or a party who has ultimate control over a project suddenly withdraws all liquidity or abandons the project after raising funds from investors. This results in huge losses for investors, as the tokens or projects they backed lose value drastically or become worthless. Rugpull usually occurs in new crypto or DeFi (Decentralized Finance) projects that seem promising and attract many investors.

Developers or parties associated with the project will promote the token, attract attention and funds from the public, and then disappear once liquidity has been accumulated, often without a trace. There are two types of Rugpull including :

• Soft rugpull: Developers slowly withdraw from the project and sell their token holdings in bulk, drastically lowering the token price.
• Hard rugpull: Developers suddenly withdraw all liquidity from the project, locking out or stopping investors' ability to sell tokens, rendering the tokens worthless.

Rugpull has become a significant problem in the crypto ecosystem, especially with the rise of new tokens being launched on decentralized platforms. To avoid Rugpull, investors are encouraged to conduct in-depth research (DYOR), including examining the liquidity of the project, the smart contracts used, and the transparency of the development team.