A rug pull is defined as the intentional act of a project owner or team to abscond with invested funds. It is considered a type of scam in the cryptocurrency world and is often perpetrated by fraudulent projects that promise high returns and fail to deliver.
Rug pulls typically occur in one of two ways. The first is when a project owner simply disappears with the funds that have been invested. The second is when the project team deliberately shuts down the project and absconds with the funds.
Rug pulls can be especially harmful to investors because they often result in the loss of all of their invested funds. For this reason, it is important to be aware of the risks associated with investing in cryptocurrency projects. Furthermore, it is prudent to only invest in projects that you trust and that have a solid track record.