How Do On-Chain Analytics Help Detect Suspicious Activity before a Rug Pull?
On-chain analytics tools monitor the movement of funds and token distribution on the blockchain. They can flag suspicious activities, such as large, sudden transfers of team or developer tokens to an exchange, or the creation of new, unaudited liquidity pools.
Tracking the flow of initial investment funds can reveal if they are being consolidated for an imminent withdrawal.
Glossar
On-Chain Analytics
Provenance ⎊ On-Chain analytics, within cryptocurrency and derivatives, establishes a verifiable record of asset history and transaction flows, crucial for assessing counterparty risk and market manipulation.
Transaction Tracing
Method ⎊ Transaction Tracing is the forensic process of analyzing the sequential movement of digital assets across blockchain ledgers to reconstruct the complete financial path of funds, often necessary to establish the provenance of collateral or the proceeds of illicit activity.
Suspicious Activity
Anomaly ⎊ Suspicious activity within cryptocurrency, options trading, and financial derivatives often manifests as statistically improbable price movements or volume spikes, deviating from established market norms.