An exit scam or rug pull is a confidence trick, con job or fraud, perpetuated under the guise of a legitimate business, that ends when the originator absconds with the funds contributed by participants.
[5] For individual vendors, exit scams are often a viable scheme when dealing with any physical product (for which buyers must reasonably expect to wait before receiving orders, thus often granting the perpetrator a considerable grace period before the scam can no longer be plausibly denied) compared to digital, virtual and other intangible goods which buyers will generally expect to be delivered within a very short time after remitting payment.
If an illegal entity thrives by selling and/or facilitating the sale of illicit drugs, for example, it is at constant risk of being shut down by the authorities, whereas if the operators perform an exit scam, there are much better prospects for the perpetrators to both keep their profits and avoid eventual prosecution.
[citation needed] Purchasers can also perpetrate exit scams if, while secretly planning to close their business or abscond, they procure goods and services for which they do not intend to pay.
[7][8] This would ultimately be surpassed by the Wall Street Market exit scam of 2019, which had $14.2 million worth of cryptocurrencies stolen just before the site was seized by the authorities.