Recently, the Non-Fungible Token (NFT) and metaverse mania gave the impression that the cryptocurrency business was all cheese and champagne. Then, in the first half of 2022, a number of crypto-related breaches and rug pulls victimised the market for digital assets.

But what precisely are rug pulls and hacks? What can you do to keep safe and how do they differ?

Rugpulls vs. Hacks The producer and the customer are typically the two parties involved in transactions, as you are aware. A rug pull or swindle occurs when the producers themselves steal from the customer, alluding to literally pulling the rug out from under them. On the other side, it is referred to as a hack, attack, or exploit if a third party tries to steal from both parties.

Take this as a case study. If the bank decides to make off with the customers' money one fine morning, it will be regarded as a scam—or, in crypto-speak, a rug pull. The robbers, however, are the third party in a bank heist. They deprive the customer and the bank of any funds. That is hacking.

What is a crypto rug pull? Developers who utilise cryptocurrency rug pulls make the investors in their project lose money. The creators of these initiatives resemble antiheroes—"good" individuals who end up being wicked guys. However, there are two different sorts of rug pulls.

Hard Rugpulls: In this essay, we concentrate on this type of rug pull because it is the one that most people are familiar with. They are well-planned, and their main goal is to steal from the community while maintaining their trust.

Soft rug pulls occur when tokens are devalued because the developers are in a desperate situation and decide to sell their crypto assets over night as a result. Although such pumping and dumping is considered unethical.

NFT rug pulls External parties stealing from cryptocurrency platforms, companies, or individual retail investors constitute cryptocurrency hacks. A hacker has a considerably wider range of options for stealing cryptocurrency, some of which are covered here.

Defi Rug Pulls Blur Finance, a yield aggregator active on BNB Chain and Polygon, was a participant in a recent DeFi fraud. However, the initiative was abruptly abandoned earlier this year, and all of its social media accounts were erased. The procedure resulted in tokens disappearing worth more than $600,000, according to security company PeckShield.