Exit scam
An exit scam occurs when operators take users' money or assets and disappear, abandon promised obligations, or deliberately prevent users from recovering funds.
✦ Key Insight
Crypto transactions can be difficult to reverse, which can make recovery after an exit scam challenging.
✕ Common Misconceptions
Anonymous teams alone do not prove fraud, but centralized control, unverifiable claims and unrestricted treasury access increase risk.
Detailed Explanation
In Practice
Dig Deeper
Rug Pull
When a project's team abandons it and takes investors' funds, usually by removing liquidity or dumping their allocation.
Honeypot Token
A honeypot token is a malicious or heavily restricted token that users can buy but ordinary holders cannot successfully sell under normal conditions.
Ponzi vs pyramid
A Ponzi scheme generally pays earlier participants using money from later participants, while a pyramid scheme depends heavily on participants recruiting additional participants into the structure.