Rug pull

The phrase comes from "pulling the rug out from under" someone. Buyers are standing on a market that looks solid, and the people who built it yank it away. Getting "rugged" means you held a coin when that happened.

Every rug works the same way underneath. A few people own a large share of the coin, bought cheaply, and they sell it all into the buyers who arrived later. The price falls because each sell pushes it down, and there are not enough buyers left to absorb it.

The size of the drop is just math. On a pump.fun coin worth $20,000, one wallet selling 20% of the supply in a single transaction takes the price down about 49% (worked out in how to not get rugged). A group of insiders holding more than that can take it close to zero.

Traders use a handful of names for different versions. Most rugs on today's Solana launchpads are dumps, not liquidity pulls, because the launchpad's own program holds the liquidity.

The last two are why the launchpad matters. A coin created by a launchpad's own program gets that program's standard settings, which removes the token-level tricks covered under honeypot.

No single sign proves a rug, and a clean-looking coin can still be dumped. Several of these together change the odds a lot.

• A few wallets hold a large share of the supply, or many wallets that were all funded from the same source.
• The dev wallet has a history of launching coins and selling within hours. See dev wallet.
• Buys landed in the same block the coin was created, often through a bundle.
• Volume does not match the number of traders: heavy trading from a small set of wallets, or repeated identical trade sizes.
• The price fades under steady buying. Someone is selling into every buy.
• Lots of buys and almost no sells from wallets other than the creator, which is the honeypot pattern.
• Promises instead of facts: guaranteed listings, "next 100x", paid shills and a countdown to a big announcement.

This takes a few minutes in any trading terminal's token-safety panel or on a Solana block explorer. Do it before you buy; afterwards it only explains the loss.

1. 1

   Confirm the contract address

   Copy it from the launchpad page, not from a reply or a DM. pump.fun addresses end in pump and LetsBonk addresses in bonk; a lookalike name with a different address is a different coin.

2. 2

   Check mint and freeze authority

   Both should be revoked (empty). If the creator still has mint authority they can print new supply; with freeze authority they can stop holders from moving their tokens.

3. 3

   Read the top holders

   Ignore the bonding-curve or pool account, which holds unsold supply and is not a person. Then add up the largest real wallets. One wallet or a cluster above a few percent can move the price hard.

4. 4

   Look up the dev wallet

   How much does the creator still hold, and what happened to its previous coins? A wallet that has launched dozens of coins and sold each one is showing you its business model.

5. 5

   Check the bundle and insider share

   Many terminals estimate the share bought in the launch bundle. Treat it as an estimate and look for wallets funded from one source just before launch.

6. 6

   Check the liquidity

   For a graduated pump.fun coin, the pool's LP tokens are burnt, so nobody can withdraw them. For a coin with its own pool outside a launchpad, find out who controls the LP tokens.

7. 7

   Watch the trades

   Confirm that wallets other than the creator have sold successfully, and compare the volume with the number of unique traders.

The longer walk-through, with the patterns ranked by how often they take traders' SOL, is how to not get rugged. New to all of this? Start with how to trade memecoins.

Solana transactions are final, so in almost every case the money cannot be clawed back. What you can do is limit the damage and avoid a second loss.

1. Do not buy more to average down. A coin bleeding under steady selling is being sold into, and new buys become someone's exit.
2. Decide whether selling is worth it. If the coin still trades, compare what is left with the fees to sell. A small test sell first shows whether selling works at all.
3. Ignore anyone offering to recover your funds. Recovery offers in DMs and replies are a second scam aimed at people who were just rugged.
4. Check your wallet's safety. A rug takes your purchase, not your wallet. But if you connected to an unfamiliar site or signed something odd, move what is left to a new wallet.
5. Keep records: the contract address, your transaction signatures and where the coin was promoted. In the US, crypto fraud can be reported to the FBI's IC3, and a tax professional can tell you how a loss is treated where you live.
6. Write down which warning sign you skipped. That note is the only part of the loss you can reuse.

Fullport accounts trade a simulated balance at live on-chain prices, so you can practice reading coins without your own SOL in them. Only coins from allowlisted launchpads are tradeable, and each mint is verified on-chain.

Coins with manufactured charts, such as rugs, honeypots and coins pumped by their creator or a bundle, are outside the tradeable set under the conduct rules. Start in the browser terminal with no wallet, from your phone, with no KYC; see the rules and pricing.