What Is the Risk of a “Rug Pull” and How Does Immutability Relate to It?

A "rug pull" is a malicious act where the developers of a crypto project suddenly drain all the liquidity from a trading pool, often by exploiting a hidden function in the smart contract. Immutability relates to this by either preventing it, if the contract is truly fixed and open-source, or by enabling it, if the malicious function is permanently embedded.

If the contract is not immutable or has a hidden "owner" function to withdraw funds, the rug pull is possible and irreversible.