Token Rug Pull vs NFT Rug Pull: How Scams Differ and How to Avoid Them

When you hear "rug pull," you might picture someone yanking a carpet out from under you. In crypto, it’s exactly that-but instead of a rug, it’s your money, your NFT, or your trust. And it happens faster than you think. Two main types of rug pulls dominate the blockchain world: token rug pulls and NFT rug pulls. They look similar on the surface-both promise big returns, vanish overnight, and leave victims with nothing. But underneath, they operate in completely different ways. Understanding the difference isn’t just useful-it could save you thousands.

How Token Rug Pulls Work

Token rug pulls target fungible tokens-like ERC-20 or BEP-20 coins-that you can trade, send, or stake. These scams are fast, brutal, and often rely on smart contract tricks you can’t see until it’s too late.

The most common method? Liquidity pool draining. Here’s how it goes: scammers create a new token, pair it with ETH or BNB on a decentralized exchange like Uniswap or PancakeSwap, and then flood social media with hype. They’ll post fake testimonials, pay influencers, and use bots to create fake trading volume. Once enough people buy in and lock their funds into the liquidity pool, the devs pull the plug. They withdraw all the ETH or BNB that was backing the token, leaving the token itself worthless. One minute it’s trading at $0.50, the next it’s $0.0001-and no one can sell.

Another classic move is hidden sell restrictions. Some contracts are coded so you can buy the token, but you can’t sell it. That’s called a honeypot. You think you’re investing-you’re actually trapped. Solidus Labs found that 62% of token rug pulls in 2023 used this trick. Even worse, some contracts have hidden functions that let devs mint unlimited new tokens, diluting your holdings to nothing.

Take the Squid Game token (SQUID) in November 2021. It surged 2,400% in a day after going viral on TikTok. Then, in under four hours, the devs drained $3.3 million from the liquidity pool and disappeared. The token dropped to zero. No warning. No notice. Just silence.

How NFT Rug Pulls Are Different

NFT rug pulls don’t rely on smart contract traps. They rely on broken promises.

Instead of draining liquidity, NFT scammers build hype around a collection-often a Bored Ape clone-with flashy art, a roadmap full of promises, and a Discord community that feels alive. They’ll say: "We’re building a metaverse game," "You’ll get exclusive access to a real-world event," or "Your NFT will unlock a staking reward." Then, they disappear.

The timeline is slower than token rug pulls. While a token scam can collapse in hours, NFT rug pulls usually take 30 to 90 days. Why? Because they need time to build trust. They’ll post daily updates, host AMAs, and even release a few early features-just enough to make you believe the project is real. Then, around day 60, the Discord admins vanish. The website goes dark. The Twitter account stops posting. The roadmap? Never updated again.

The Blur Finance incident in March 2023 is a textbook example. The team raised $600,000 in ETH from NFT sales, promising a yield aggregator for NFT holders. They launched, collected fees, and then deleted all social media. No one saw it coming-because they’d been so convincing.

Unlike token rug pulls, NFT scams rarely involve code exploits. Instead, they exploit psychology. You’re not just buying a JPEG-you’re buying into a community, a future, a lifestyle. And that’s harder to detect.

Key Differences Between the Two

Here’s the real breakdown:

Token rug pulls are like a bank heist-fast, violent, and over before you know it. NFT rug pulls are more like a con artist building a fake charity. They gain your trust, take your money, and then vanish-leaving you wondering if you were just naive.

How to Spot a Rug Pull Before It Happens

There’s no foolproof way to avoid rug pulls-but you can drastically reduce your risk.

For Token Investors:

• Check if the contract is renounced. If the devs still control the contract, they can change the rules anytime. Use Etherscan or BscScan to verify ownership.
• Look for locked liquidity. Projects that lock liquidity for 6+ months on platforms like Unicrypt are less likely to rug.
• Use detection tools. RugDoc.io and RPHunter scan contracts for hidden traps. They’re not perfect, but they catch 90% of obvious scams.
• Watch for unusual tokenomics. If 30%+ of tokens are held by one address, or if there’s a 100% sell tax, run.

For NFT Buyers:

• Check the team. Anonymous teams? Red flag. Real teams have LinkedIn profiles, past projects, and public identities. If they’re hiding behind a pseudonym, they’re hiding something.
• Read the roadmap. If it says "launch metaverse game in 2025" with no milestones, it’s vaporware. Look for quarterly deliverables.
• Join the Discord. Are the mods active? Do they answer questions? Or do they delete critical comments? Silence is a warning.
• Compare to blue-chips. If the NFT looks like a Bored Ape clone but costs 1/10th the price, it’s probably a copycat.

Why Recovery Is Almost Impossible

Most people think: "If I get scammed, I’ll report it." But crypto doesn’t work like that. There’s no central authority. No customer service line. No refund policy.

Token rug pulls leave zero traceable funds. The devs drain liquidity into mixers like Tornado Cash or send it across chains to obscure the trail. Chainalysis found that 40% of rug pull funds now move through cross-chain bridges to avoid detection.

NFT rug pulls are even trickier. Since NFTs are unique, there’s no standard way to prove fraud. You can’t prove a team lied about a "metaverse game" unless they said it in writing-and even then, courts rarely intervene.

According to Trustpilot data, only 8% of token rug pull victims recover any funds. For NFTs, it’s 23%. Why? Because NFT communities sometimes band together to track down devs or pressure them publicly. But even then, you’re lucky if you get 5% back.

The Future of Rug Pulls

Scammers are getting smarter. In Q1 2024, Kaspersky found that 17% of token rug pulls used AI-generated marketing videos and fake team bios. NFT scams are now using deepfake videos of "founders" to livestream fake updates.

Worse, hybrid rug pulls are emerging-projects that combine token and NFT elements. Imagine buying an NFT that gives you access to a token that then gets rug pulled. These are harder to detect because they mix two scam types.

Regulators are catching up. The SEC has filed 12 cases against token rug pulls since 2022, including the Squid Game settlement. But NFTs? Only 3 cases. That’s changing. SEC Commissioner Hester Peirce warned in May 2024 that "NFT rug pulls will face increased scrutiny in 2025."

For now, the best defense is awareness. Don’t chase hype. Don’t trust influencers. Don’t assume a project is real because it has a fancy website. Do your homework. Check the code. Verify the team. Ask hard questions.

If it sounds too good to be true-it is. And in crypto, that’s not just a saying. It’s a survival rule.