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NFT and crypto scams: What is a rug pull?
Fraudsters exploit crypto's lack of oversight to scam investors, causing $2.2 billion in losses globally in 2024, a 21% increase since 2021, regulators warn.
- Recently, consumers around the world lost $2.2 billion to crypto scams in 2024, as crypto rug pulls drained token liquidity and caused values to collapse.
- Development teams commonly drum up support then disappear, exploiting crypto's limited regulation and lack of traceability to move funds without reversals.
- High-Profile cases illustrate the scale and tactics of rug pulls: Haliey Welch's 'Hawk' token fell 95% after reaching $490 million, Kim Kardashian promoted EthereumMax which lost 97% while paying a $1.26 million SEC fine, and Faruk Özer, Thodex founder, fled with $2.6 billion from 400,000 users.
- Rug pulls have eroded confidence even as markets grew; Pew recently found 63% of Americans distrust crypto and many investors hold worthless tokens.
- Confirm funds are locked and get audit reports before investing, avoid anonymous developers and influencers, and always do research to reduce risk.
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32 Articles
32 Articles
Coverage Details
Total News Sources32
Leaning Left2Leaning Right5Center12Last UpdatedBias Distribution63% Center
Bias Distribution
- 63% of the sources are Center
63% Center
11%
C 63%
R 26%
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