Supply Distribution and Insider Risk
Check how supply is distributed and whether liquidity is locked. High insider concentration plus unlocked liquidity is a high rug-risk combination.
What it means
Distribution is who owns the tokens. 'Bundled' supply is when insiders spread their holdings across many wallets to look decentralized. Liquidity lock status tells you whether the creator can remove the pool.
Why it matters
If a handful of wallets (or one insider behind many) hold most of the supply, they can sell into every buyer. If liquidity is unlocked, they can also just remove it.
What happens if you ignore this
Concentrated supply plus unlocked liquidity is the setup for a coordinated dump or an outright rug. Your exit depends on liquidity that someone else can delete.
Beginner tips
- Look past the holder count — many wallets can still be one insider (bundling).
- Locked liquidity and broad distribution reduce risk; they never guarantee safety.
- Always size positions as if total loss is possible, because with these tokens it is.
Common mistakes
- Assuming many holders means decentralized ownership.
- Ignoring liquidity lock status because the price is moving up.