Definition
A fraudulent exit strategy in which the creators or developers of a cryptocurrency, NFT project, or Web3 venture abruptly abandon the project and withdraw all invested funds, leaving investors and community members with worthless assets. Rug pulls are one of the most common forms of fraud in the Web3 creator economy, where projects attract investment through promises of future utility, community benefits, or financial returns before the founders disappear with the funds. The term originates from the idiom "pulling the rug out from under someone" and has become a widely recognized risk warning in crypto and NFT communities.