Overview
A rug pull is a scam where token creators suddenly remove all liquidity from a trading pool, crashing the token’s value to near zero and leaving investors with worthless holdings.
Rug pulls have caused billions in losses across crypto. Always verify liquidity locks and team credibility before investing.
How Rug Pulls Work
- Token Creation: Scammer creates a new token
- Liquidity Addition: Initial liquidity is added to DEX
- Hype Building: Aggressive marketing attracts buyers
- Price Pump: Buying pressure increases token price
- Rug Pull: Creator removes liquidity, crashing the price
- Exit: Scammer disappears with the funds
Types of Rug Pulls
Hard Rug Pull
- Sudden, complete liquidity removal
- Token becomes immediately untradeable
- Most obvious but hardest to recover from
Soft Rug Pull
- Gradual selling by insiders
- Slow price decline over time
- Harder to identify as a scam
Liquidity Drain
- Hidden functions allow liquidity removal
- May bypass “locked” liquidity claims
- Often uses complex contract mechanisms
Detection Indicators
| Tag | Severity | Description |
|---|
rug_pull | Critical | Token associated with rug pull activity |
unlocked_liquidity | High | Liquidity is not locked |
low_liquidity | High | Insufficient liquidity for safe trading |
owner_can_drain | Critical | Owner has ability to drain funds |
minter-rug_pull | Critical | Token minter involved in previous rugs |
API Example
curl -X GET "https://api.webacy.com/tokens/0x123...?chain=eth" \
-H "x-api-key: YOUR_API_KEY"
{
"overallRisk": 95.0,
"issues": [
{
"tag": "unlocked_liquidity",
"severity": "high",
"description": "Liquidity is not locked and can be removed at any time"
},
{
"tag": "minter-rug_pull",
"severity": "critical",
"description": "Token minter has been involved in previous rug pulls"
}
]
}
Red Flags
- Unlocked liquidity - No verified lock on LP tokens
- Anonymous team - No public, verifiable identities
- Unrealistic promises - Guaranteed returns or moonshot claims
- Rushed launch - Little documentation or roadmap
- Concentrated ownership - Few wallets hold most supply
- No audit - Contract not reviewed by reputable auditors
Liquidity Analysis
# Check liquidity pools for a token
curl -X GET "https://api.webacy.com/tokens/0x123.../pools?chain=eth" \
-H "x-api-key: YOUR_API_KEY"
- Total liquidity - Higher is generally safer
- Lock status - Is LP locked? For how long?
- Lock contract - Is it a reputable locker?
- Unlock date - When can liquidity be removed?
Protection Strategies
- Verify liquidity locks - Check lock duration and contract
- Research the team - Look for doxxed, verifiable members
- Check holder distribution - Avoid concentrated ownership
- Start small - Never invest more than you can afford to lose
- Use Risk DD - Scan tokens before investing
- Monitor for changes - Set up alerts for liquidity movements
