Cryptocurrency rug pulls, which occur when a project’s team pumps their token before suddenly withdrawing liquidity, are one of the easiest scams to prevent, according to blockchain security auditor Hacken. The majority of rug pulls share distinct and visible features, making them relatively easy to spot. Hacken’s latest security insights report found that rug pulls accounted for over 65% of all hacks in Q3 2023. The report highlighted the importance of independent third-party audits in assessing a project’s legitimacy. However, Hacken cautioned that an audit alone does not guarantee protection from scams, as the quality of the audit should also be considered. The fear of missing out often leads investors to overlook red flags and impulsively invest in scams. Hacken CEO Dyma Budorin emphasized that investing in cryptocurrency can be a quick and easy process, which can contribute to impulsive decision-making.
