The “rug pull” is a brand-new fraud that has surfaced in the world of cryptocurrencies. According to a recent report, scammers stole $14 billion worth of cryptocurrency in 2021, setting a new record for cryptocurrency theft.
The fraud involves a developer luring investors to a new cryptocurrency project, pulling out before the project is constructed, and leaving investors with worthless currency. The phrase “pulling the rug out” gives the scam its name. The investment scheme is a part of a long line of them. So it’s not surprising that “Olympic-level scammers” have taken full advantage of new chances for illegal conduct, given the surge in interest in cryptocurrencies over the past year.
The use of “smart contracts,” or agreements managed by computer software rather than the legal system, is daily in cryptocurrency initiatives. This system can be advantageous when transaction costs are reduced, but it also leaves little room for error. The decentralized finance, or DeFi, programmes that aim to undermine industries like banking and insurance have been particularly prone to rug pulls. Rug pulls have also been associated with NFTs, or non-fungible tokens, which grant digital ownership of art and other assets.
Bunnyverse is a cross-chain network intricately designed for the best gaming experience. It aims to provide a truly decentralized gaming platform as a service with decentralized technologies marking it as the best and safe platform for every user. Recently, Supercluster- the best NFT marketplace- partnered up with Bunny-Verse and is launching soon. Bunnyverse will release their NFTs, giving access to the game’s beta version.
How Investors can protect themselves from the Crypto Market?
Even the most knowledgeable and passionate cryptocurrency experts know that there are now a lot of new and developing threats in the world of cryptocurrencies. However, investors can safeguard themselves by picking well-known cryptocurrency projects, ensuring that the code of any new project has been vetted, and confirming the creators’ names.
Choose reputable products-
Rug pulls are more frequent in new projects that haven’t been subjected to the same level of scrutiny as more established cryptocurrencies.
Although there are risks associated with using digital currencies, a considerable number of people have done so and examined their inner workings, which are easily accessible online. However, since more recent initiatives don’t have the same track record, they can contain flaws that allow developers to steal money from investors and keep it for themselves.
While being listed on a major exchange is by no means a guarantee of a cryptocurrency’s value or investment potential, these companies frequently inspect assets before putting them up for sale. Several influential websites have selected Bunnyverse as the top platform for crypto gaming tokens.
Understand the code-
The reliability of the project’s computer code determines whether an investment in a cryptocurrency or blockchain project will succeed or fail. Therefore, even if you are not a computer programmer, you should at least be aware of a product’s operation before purchasing it.
Checking to check if a reputable professional body has audited an investment is one approach to assessing a potential investment without doing the work yourself. In addition, projects that have received high grades from auditors frequently advertise the outcomes independently.
Investigate the people beforehand-
In the world of cryptocurrencies, human aspects are some of the giant red flags. Although it’s not unheard of for bitcoin users to go by aliases, reputable developers frequently have websites and references that may attest to their qualifications.
However, even if you do your homework, success is not guaranteed. In the world of cryptocurrencies, as in any other, diversification is crucial. Projects might fail due to business errors or technical malfunctions even without malevolent intent.