The DeFi is a term that stands for Decentralized Finance. The DeFi system is a digitized alternative for the traditional financial practices that are used traditionally for the fiat banking system. The users can get exposure to crypto by gaining interest through establishing savings accounts or a Certificate of Deposit. Since the DeFi projects are primarily decentralized, they can be get started with little to no investment.


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Hackers with ill intentions take advantage of such a situation and plan out a huge strategy by creating a heist on unsuspecting investors. These scams are called Rugpulls because the investors have no idea what will happen with them in the next moment. Unfortunately, some of the biggest and most trusted names in the crypto space have been found guilty of running such scams.

How Do RugPulls Work, and What is the best way to Guard against them?

Rugpulls can be termed as organized and white crime. Primitive criminals do not conduct these scams, but they require a certain amount of preparation and deliberation on the part of the criminals. The Rugpulls are usually presented as lucrative investment schemes that are short-lived. These scammers lure investors by running flashy social media campaigns and making outrageous claims for huge returns.

The non-technical investor who does not have a very good idea about the basic structure of the market usually is a victim of these scams. In many cases, investors are convinced to put their cryptocurrency deposits into a giant aggregate account. Or sometimes, they are asked to convert their present crypto stash into the digital asset that the scammers offer. However, when the victims have put in their money, the scammers fold their operations and disappear into thin air.

The Alarming History and Rise of RugPulls in the Crypto Space

Some of the most damaging and notorious rug pulls are dated not far back. Burn Vault Finance was blacklisted by the user base when they found out that the program’s founder owned 50% of the tokens. During an ongoing investigation by the Telegram group authorities, they were unable to provide solid proof. Unicat project issued the token that was controlled by its founder even when it was exported from the pool. 

This program stole about $200,000 worth of crypto. YfDex.finance is another crypto scam example that managed to rake $20 million after campaigning for two days on social media platforms. Emerald Mine founder moved about $2.5 million worth of cryptocurrencies to an unknown wallet and folded its operations. The crypto exchange Changenow managed to block a few transactions; however, it caused a lot of destruction on an international level. Many more rug pulls operations keep emerging from time to time. It is advised that investors conduct in-depth research about the founder and team behind these DeFi projects before putting in their money.   


How To Get Your Money Back From Scammers?

Want to get your money back from a scam?
Fill in the contact form on the page in this link and you will be able to get help in recovering your lost funds! You will be walked through the entire recovery process by a representative of a recommended fund recovery service after which a case will be opened for you by a case manager.


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