Rug Pull Scams

rug

A rug is a floor covering that covers part of a room. A rug may be a small piece that is placed over a carpet or a large area covered by a woven textile, such as wool. Rugs provide comfort underfoot, define space in a room and add color or pattern to the floor. They are also a barrier against cold floors and help keep a home or office warmer in winter and cooler in summer. Rugs also catch dirt, reducing the need to sweep and vacuum, and make a child’s playroom safe by providing a soft landing surface.

The word rug comes from the Old Norse word rogg and the Persian rag or rawwa, but it only became common in English by the 1500’s. The term “carpet” was used before then, though, and it reflects the fact that carpets often cover the entire floor.

Rug Pull Scams

The number of crypto and NFT rug pull scams is growing as more people invest money in decentralized finance (DeFi). These scams are typically carried out by a developer who hypes up a project to attract investors, then shuts down the project or disappears, taking investor funds with them. These scams can be hard or soft, with hard rug pulls involving code-level fraud and soft pulls using marketing to falsely inflate the value of a project and then closing down to steal investor funds. While these scams can be difficult to spot, there are some red flags that you can look out for that can help prevent being ripped off in this way.