# How Does a "Rug Pull" Differ from a "Pump and Dump" in the Crypto Space? ⎊ Path

**Published:** 2025-12-04
**Author:** Greeks.live
**Categories:** Path

---

## How Does a “Rug Pull” Differ from a “Pump and Dump” in the Crypto Space?

A pump and dump involves manipulating the price of an already existing, often low-cap, coin. A rug pull, however, is typically associated with a newly created token by the project developers themselves.

In a rug pull, the developers drain the liquidity pool after launching the token, effectively stealing the funds raised from investors. The token's value immediately drops to zero, and the project vanishes.

The key difference is the involvement of the project's own creators.

- [What Is ‘Impermanent Loss’ in the Context of Providing Liquidity?](https://learn.greeks.live/path/what-is-impermanent-loss-in-the-context-of-providing-liquidity/)

- [What Is a “Rug Pull” in the Context of a Liquidity Pool?](https://learn.greeks.live/path/what-is-a-rug-pull-in-the-context-of-a-liquidity-pool/)

- [What Is the Risk of a “Rug Pull” in the Context of a DAO Providing Liquidity to a New Token Pair?](https://learn.greeks.live/path/what-is-the-risk-of-a-rug-pull-in-the-context-of-a-dao-providing-liquidity-to-a-new-token-pair/)

- [Explain the Concept of “Rug Pull” in Relation to Mutable Contract Ownership](https://learn.greeks.live/path/explain-the-concept-of-rug-pull-in-relation-to-mutable-contract-ownership/)

- [What Is a Liquidity Pool in Decentralized Finance (DeFi)?](https://learn.greeks.live/path/what-is-a-liquidity-pool-in-decentralized-finance-defi/)

- [How Do Decentralized Exchanges (DEXs) Make Rug Pulls Possible?](https://learn.greeks.live/path/how-do-decentralized-exchanges-dexs-make-rug-pulls-possible/)

- [How Can Investors Detect a Potential ‘Soft Rug’ Pull versus a ‘Hard Rug’ Pull?](https://learn.greeks.live/path/how-can-investors-detect-a-potential-soft-rug-pull-versus-a-hard-rug-pull/)

- [What Is a “Rug Pull” in the Context of ICOs?](https://learn.greeks.live/path/what-is-a-rug-pull-in-the-context-of-icos/)

## Glossar

### [Rug Pulls](https://learn.greeks.live/area/rug-pulls/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Deception ⎊ The term "Rug Pull" within cryptocurrency, options trading, and financial derivatives denotes a deceptive practice where developers or project founders abruptly abandon a project, taking investor funds with them.

### [Liquidity Pool](https://learn.greeks.live/area/liquidity-pool/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Mechanism ⎊ A liquidity pool functions as an incentivized counterparty in decentralized finance, aggregating capital from multiple participants to facilitate trading without traditional intermediaries.

### [Decentralized Finance](https://learn.greeks.live/area/decentralized-finance/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Architecture ⎊ Decentralized Finance, within the cryptocurrency ecosystem, represents a paradigm shift in financial infrastructure, moving away from centralized intermediaries towards peer-to-peer systems leveraging blockchain technology.

### [Pump and Dump](https://learn.greeks.live/area/pump-and-dump/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Scheme ⎊ The pump and dump is a classic market manipulation scheme, adapted for the crypto space, where perpetrators artificially inflate the price of a low-liquidity asset through coordinated buying and misleading promotional efforts.

### [Decentralized Exchanges](https://learn.greeks.live/area/decentralized-exchanges/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Access ⎊ These platforms offer permissionless entry to cryptocurrency and tokenized asset markets, democratizing capital deployment into novel financial structures.

## Discover More

### [How Does a Deep In-the-Money Call Option Differ from Holding the Crypto Directly?](https://learn.greeks.live/path/how-does-a-deep-in-the-money-call-option-differ-from-holding-the-crypto-directly/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a Deep In-the-Money Call Option Differ from Holding the Crypto Directly?](https://learn.greeks.live/wp-content/uploads/2025/10/Geometric-Abstraction-Modeling-Intertwined-Digital-Asset-Hedging-Strategies-and-Volatility-Surface-Contours.webp)

DITM calls offer leveraged exposure with limited downside risk, unlike direct ownership which requires full capital.

### [What Is a 'Rug Pull' in the Context of a Cryptocurrency Project?](https://learn.greeks.live/path/what-is-a-rug-pull-in-the-context-of-a-cryptocurrency-project/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is a 'Rug Pull' in the Context of a Cryptocurrency Project?](https://learn.greeks.live/wp-content/uploads/2025/10/Sharp-Geometric-Projection-of-DeFi-Collateral-Pool-Dynamics-Over-Dark-Pool-Liquidity.webp)

Developers suddenly remove all liquidity from a trading pool, making the token worthless and causing investor loss.

### [How Does the Concept of 'Margin' in Derivatives Relate to the Cost of Competing for Block Space?](https://learn.greeks.live/path/how-does-the-concept-of-margin-in-derivatives-relate-to-the-cost-of-competing-for-block-space/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the Concept of 'Margin' in Derivatives Relate to the Cost of Competing for Block Space?](https://learn.greeks.live/wp-content/uploads/2025/10/Hypersonic-Missile-Aerodynamics-Modeling-High-Frequency-Crypto-Derivative-Execution-Mechanisms.webp)

Margin: collateral for leveraged risk in Derivatives. Gas Price: fee for network resource consumption in Crypto. Both are costs of engagement.

### [What Is Impermanent Loss and Is It Related to a Rug Pull?](https://learn.greeks.live/path/what-is-impermanent-loss-and-is-it-related-to-a-rug-pull/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is Impermanent Loss and Is It Related to a Rug Pull?](https://learn.greeks.live/wp-content/uploads/2025/10/Deep-Blue-Onyx-Encapsulation-Reflecting-Market-Volatility-In-Digital-Asset-Derivatives-Pricing.webp)

Impermanent loss is a normal market risk for liquidity providers, but a rug pull's sudden price drop causes an extreme, intentional version.

### [How Does the Settlement Process Differ between a Traditional Dark Pool Trade and a Crypto OTC Trade?](https://learn.greeks.live/path/how-does-the-settlement-process-differ-between-a-traditional-dark-pool-trade-and-a-crypto-otc-trade/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the Settlement Process Differ between a Traditional Dark Pool Trade and a Crypto OTC Trade?](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetry-in-Blockchain-Asset-Hedging-Symmetric-Pairwise-Futures-Contract-Execution-Visualized.webp)

Traditional trades use central clearing with T+settlement, while crypto OTC trades often settle instantly on-chain, eliminating the clearing house.

### [What Is the Block Size Limit and How Does It Enforce Scarcity in Block Space?](https://learn.greeks.live/path/what-is-the-block-size-limit-and-how-does-it-enforce-scarcity-in-block-space/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Block Size Limit and How Does It Enforce Scarcity in Block Space?](https://learn.greeks.live/wp-content/uploads/2025/10/Interlocking-Oscillating-Digital-Asset-Structures-Representing-Volatility-Surface-Topology-in-DeFi-Options.webp)

The block size limit caps the supply of transaction space, enforcing scarcity that drives the competitive fee market.

### [How Does a Crypto Call Option Differ from a Traditional Stock Call Option?](https://learn.greeks.live/path/how-does-a-crypto-call-option-differ-from-a-traditional-stock-call-option/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a Crypto Call Option Differ from a Traditional Stock Call Option?](https://learn.greeks.live/wp-content/uploads/2025/10/Analyzing-Digital-Asset-Volatility-Through-Stochastic-Process-Modeling-of-Option-Greeks-Visualization.webp)

Crypto options use volatile, 24/7 traded digital assets; stock options use company shares.

### [How Does Proof-of-Stake Differ from Proof-of-Work as a Consensus Mechanism?](https://learn.greeks.live/path/how-does-proof-of-stake-differ-from-proof-of-work-as-a-consensus-mechanism/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does Proof-of-Stake Differ from Proof-of-Work as a Consensus Mechanism?](https://learn.greeks.live/wp-content/uploads/2025/10/High-Fidelity-Optical-Mechanism-Modeling-Quantum-Resistant-Derivatives-Settlement-Precision.webp)

Replaces computational effort with economic stake; Validators chosen by stake amount; Energy efficient.

### [What Is the Difference between a "Partnership" and a "Collaboration" in the Crypto Space?](https://learn.greeks.live/path/what-is-the-difference-between-a-partnership-and-a-collaboration-in-the-crypto-space/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Difference between a "Partnership" and a "Collaboration" in the Crypto Space?](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetrical-Intersecting-Black-Scalar-Beams-Encapsulating-Central-Volatile-Digital-Asset-Orbs.webp)

Partnership is a formal, long-term, strategic integration; collaboration is a less formal, shorter-term arrangement for a specific goal.

---

## Raw Schema Data

```json
{
    "@context": "https://schema.org",
    "@type": "BreadcrumbList",
    "itemListElement": [
        {
            "@type": "ListItem",
            "position": 1,
            "name": "Home",
            "item": "https://learn.greeks.live"
        },
        {
            "@type": "ListItem",
            "position": 2,
            "name": "Path",
            "item": "https://learn.greeks.live/path/"
        },
        {
            "@type": "ListItem",
            "position": 3,
            "name": "How Does a &#8220;Rug Pull&#8221; Differ from a &#8220;Pump and Dump&#8221; in the Crypto Space?",
            "item": "https://learn.greeks.live/path/how-does-a-rug-pull-differ-from-a-pump-and-dump-in-the-crypto-space/"
        }
    ]
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "Article",
    "mainEntityOfPage": {
        "@type": "WebPage",
        "@id": "https://learn.greeks.live/learn/how-does-a-rug-pull-differ-from-a-pump-and-dump-in-the-crypto-space/"
    },
    "headline": "How Does a \"Rug Pull\" Differ from a \"Pump and Dump\" in the Crypto Space? \u238a Path",
    "description": "Pump and dump manipulates an existing coin; rug pull is when developers drain liquidity of their new token. \u238a Path",
    "url": "https://learn.greeks.live/learn/how-does-a-rug-pull-differ-from-a-pump-and-dump-in-the-crypto-space/",
    "author": {
        "@type": "Person",
        "name": "Greeks.live",
        "url": "https://learn.greeks.live/author/greeks-live/"
    },
    "datePublished": "2025-12-04T07:40:50+00:00",
    "dateModified": "2025-12-04T07:40:50+00:00",
    "publisher": {
        "@type": "Organization",
        "name": "Greeks.live"
    },
    "articleSection": [
        "Path"
    ],
    "image": {
        "@type": "ImageObject",
        "url": "https://learn.greeks.live/wp-content/uploads/2025/10/Luminescent-Crystalized-Pointer-Analogy-for-DeFi-Protocol-Governance-Token-Vesting-Schedules.jpg",
        "caption": "A close-up photograph isolates a translucent, faintly luminous mint-green crystal structure terminating in a sharp point, mounted on a metallic joint connected to a partial, rounded housing featuring beige and deep blue sections. This stark composition visually models the critical moment of derivative settlement or the precise point of execution for a digital asset derivative instrument. The crystalline shaft serves as a visual analogy for tokenomics implementation, specifically illustrating the gradual release cadence of a governance token, perhaps tied to staking duration or initial coin offering lockups. Such focused visualization aids in comprehending complex concepts like implied volatility surfaces mapped across multi-term options pricing models. The metallic housing suggests the robustness of the underlying blockchain infrastructure or the fixed parameters of a collateralized debt position CDP. Analyzing this projected vector relates directly to optimizing delta hedging ratios against fluctuating spot crypto prices, ensuring optimal gamma exposure when managing open interest for leveraged synthetic asset trading mechanisms."
    }
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "WebSite",
    "url": "https://learn.greeks.live/",
    "potentialAction": {
        "@type": "SearchAction",
        "target": "https://learn.greeks.live/?s=search_term_string",
        "query-input": "required name=search_term_string"
    }
}
```

```json
{
    "@context": "https://schema.org",
    "@type": "WebPage",
    "@id": "https://learn.greeks.live/path/how-does-a-rug-pull-differ-from-a-pump-and-dump-in-the-crypto-space/",
    "mentions": [
        {
            "@type": "DefinedTerm",
            "name": "Rug Pulls",
            "url": "https://learn.greeks.live/area/rug-pulls/",
            "description": "Deception \u238a The term \"Rug Pull\" within cryptocurrency, options trading, and financial derivatives denotes a deceptive practice where developers or project founders abruptly abandon a project, taking investor funds with them."
        },
        {
            "@type": "DefinedTerm",
            "name": "Liquidity Pool",
            "url": "https://learn.greeks.live/area/liquidity-pool/",
            "description": "Mechanism \u238a A liquidity pool functions as an incentivized counterparty in decentralized finance, aggregating capital from multiple participants to facilitate trading without traditional intermediaries."
        },
        {
            "@type": "DefinedTerm",
            "name": "Decentralized Finance",
            "url": "https://learn.greeks.live/area/decentralized-finance/",
            "description": "Architecture \u238a Decentralized Finance, within the cryptocurrency ecosystem, represents a paradigm shift in financial infrastructure, moving away from centralized intermediaries towards peer-to-peer systems leveraging blockchain technology."
        },
        {
            "@type": "DefinedTerm",
            "name": "Pump and Dump",
            "url": "https://learn.greeks.live/area/pump-and-dump/",
            "description": "Scheme \u238a The pump and dump is a classic market manipulation scheme, adapted for the crypto space, where perpetrators artificially inflate the price of a low-liquidity asset through coordinated buying and misleading promotional efforts."
        },
        {
            "@type": "DefinedTerm",
            "name": "Decentralized Exchanges",
            "url": "https://learn.greeks.live/area/decentralized-exchanges/",
            "description": "Access \u238a These platforms offer permissionless entry to cryptocurrency and tokenized asset markets, democratizing capital deployment into novel financial structures."
        }
    ]
}
```


---

**Original URL:** https://learn.greeks.live/learn/how-does-a-rug-pull-differ-from-a-pump-and-dump-in-the-crypto-space/
