The entire list of crypto rags. Save your money!
A rug pull in the crypto industry is when a development team suddenly abandons a project and sells or removes all its liquidity. The name comes from the phrase to pull the rug out from under (someone), meaning to withdraw support unexpectedly.
Here’s my compendium of rug varieties I’ve uncovered in my research.
I discovered this paper a couple of weeks ago whilst researching this. 97.7% of tokens on Uniswap are rugs. ackchyually it’s worse, most of the following rug varieties take place within the 2.3%
Let’s start with:
🤷The Basic Rug
It’s an exit scam. You give me money, I promise you some stuff, I do one. I’m the winner, you lose.
🤵🏻The Classic Rug
The classic, spawned in the decentralised crypto dungeons. DEXs introduced decentralised market making. If I made the market. I hold the rug. You should always ask yourself the questions, “who holds the rug” (liquidity).
The typical xy = k AMM is initiated by someone who creates the pair and ultimately the listing price. If I create a pool with 100k $NICK tokens and 100 $ETH. I set the market rate. If you buy $NICK tokens and put $ETH in, I can pull the rug. Yoink.
🐳The Token Rug
“the liquidity is locked! NO MORE RUGS”
Not that simple unfortunately.
If the rest of the supply is accessible then locking liquidity does nothing apart from giving degens a false sense of security.
If I hold 10 million $NICK tokens, even if the LP tokens are locked I can yank (very nearly) all that $ETH out by dumping my reserve token bags and running for the hills🏃🏼♀️
🐌The Slow Rug
For the more discerning, long term thinking scammer. This time I’m gonna “fair launch” a token. Normally with so many zeroes you can’t comprehend what you’re buying. Then I’m gonna PUMP IT.
I’m talking videos of chicks in bikinis washing a lambo. Adverts on public transport. WEN MARKETING! “Here it is baby!” Then I’m gonna bleed this sucker dry, nice and slow so no one notices.
😈The Sly Rug
“oh noes, we’ve been hacked!”
Actually, I was looking at all that juicy money on the multi-sig I control, got hammered and booked a flight to Acapulco. It’s ok you’ve got the Stockholm syndrome and you will actually console me during my public crying.
📈📉The Pump and Rug
BIG LAUNCH COMING, GET IN QUICK.
“Gib allo ser pls” Ok, here’s a $70k public allocation, even though I know there’s $5m in crypto gremlin demand pent up in that telegram group.
The more competitive the better. 100k applications for 200 slots. Then funnel that demand into a DEX listing. Make the liquidity thin af, that way you slide up that xyk curve all the quicker.
Awesome, now your gutter shitcoin is valued at a $5bn FDV now it’s time to dump you insider bags. It doesn’t matter if you’re vested for 3 years you paid off your principle on launch day. Dump it to zero.
This chart pattern sure is common
🔎The Insider Rug
@cobie nailed this one in his incentive structures article https://cobie.substack.com/p/incentives-structures… the colourful slices on the pie chart are probably all the same group. The insiders. Their goal is to take your money.
Arguably, all tokens in the post ICO era have some element of this. VCs want your liquidity. To exit. Thems the breaks. Push it too far though and the whole economy forever is DOA and will never recover. For example, $ICP.
🤖The Algorithmic Rug
Automate the rug stack and deploy relentlessly. This involves mainly deploying some token with the same ticker as some legit coin and convincing degens it’s the real one. It’s closer to spam that the basic rug. This is where most of the 97.7% lives
🥪The Rug Sandwich
Set your slippage tolerance too high? You gonna get rugged. The sandwich attack involves the unsuspecting degen sending a Tx to a DEX and then an “MEV searcher” spotting their trade and front running them and selling it back to them in the same block.
🌀The Dust Rug
Do you have a .eth and are popular enough for a dirty money protest? Good luck exiting your money from any centralised exchange now. Also now you’ve got to fill out some paper to prove you’re not a terrorist for the rest of your life. RUGGED.
The Bacon Rug (@spengrah) you avoided the dust attack, but someone you know has used cash, they sent you money. Now you’re rugged. In fact, that person who got sent some has sent you some. You’re rugged too. 5 hops and we all go to zero.
📃The Vapour Rug
It’s all whitepaper and dreams and that’s it. The insiders know this and get out before you. (See, basically every ICO). NB, If you write your whitepaper in LaTeX the dreams hit so much harder.
🌉The Bridge Token Rug
You’re happily playing around on a chain using ether which is not ether it’s an IOU to a bridge contract. But uh oh, the bridge is hacked. If jump doesn’t buy you out, you’ve got an IOU of nothing.
🖨The Inflation Rug
You’re rugged, I’m rugged, everyone is rugged. Watch your paper money turn to toilet roll in front of your eyes. The only way we stop this is if we make everyone poor. Economics 101.
🥒The Sam Rug Sam
‘Rugmaster General’ Bankman-Fried got rekt because he thought the rug game would never stop. He used your money to go all in illiquid shitcoins which he (and chums) planned to dump on normies. But the music stopped playing and we got the $10b giga rug
That’s it for now. Share your own rug varieties in the comments. I’m sure there’s many many more. I hope this article helps you dodge a few rugs in the future. Share for awareness pls😉
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