Liquidity Pools, LP Locks and How Pulls Actually Work
'Rug pull' originally meant one specific act: removing liquidity from a pool. Everything a token's price did before that moment was bait funded by your buy order.
The mechanism in one paragraph
A DEX pool holds pairs of assets. Liquidity providers receive LP tokens representing their share. Burn or transfer those LP tokens to a dead address and liquidity is locked; keep them in a wallet and they are a detonator — redeem them at any time and the pool's token-side balance collapses to near zero.
Depth is not safety, control is
$2M of liquidity controlled by one wallet is more dangerous than $20k burned forever. Concentration answers 'who can pull'; depth only answers 'how much can exit before slippage'. Read both, weight control higher.
Practical reads
- Top LP holder near 100% → instant-exit capability
- Few LP providers → coordinated pull is trivial
- Locked or burned LP → check the lock's actual duration and who holds the unlock keys
RugRadar reports LP provider count and top-holder concentration directly, and scores single-wallet liquidity as critical — because historically, it is.
The softer cousin
Not every exit is a full pull. Owner wallets dumping large balances, or taxes quietly raised before a marketing push, achieve the same transfer more slowly. This is why owner-percentile findings sit alongside liquidity ones.
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