In this case, Biesk’s son had seemingly performed what is known as a soft rug pull, whereby somebody creates a new crypto token, promotes it online, then sells off their entire holdings either swiftly or over time, sinking its price. These maneuvers occupy something of a legal gray area, lawyers say, but are roundly condemned in the cryptosphere as ethically dubious at the least. 1
The rise of cryptocurrency has introduced groundbreaking opportunities, but it has also posed significant challenges, particularly in the realm of regulation.
On 19th November 2024, a teenager created a new cryptocurrency, promoted it online, and then quickly sold off all his holdings, causing the value of the coin to drop sharply. This kind of behavior, known as a “soft rug pull” 2 is not clearly illegal but is seen as unethical by many in the crypto community. The situation highlights a bigger issue: the law hasn’t kept up with the fast changes in technology, leaving a gap that allows people to take advantage of these new digital markets without facing proper consequences.
https://arstechnica.com/tech-policy/2024/12/teen-creates-memecoin-dumps-it-and-earns-50000/ ↩︎
In cryptocurrency a “soft rug pull” is an act where an individual creates a new crypto token, promotes it, and then sells off their holdings, often causing the token’s value to plummet. ↩︎