Squeed coin series#

“Generally, tokens that impose large penalties on sellers as a mechanism to discourage any selling is a red flag that investors should watch out for, as these types of mechanics interfere with price discovery and lead to artificial valuations'

Marbles could be earned by taking part in an online game inspired by the show. The developers required the token holders to buy another cryptocurrency ‘Marbles’ before they could sell the tokens.

When the crash happened, over 40,000 people held the tokens according to BScSCan, a blockchain analytics platform. The biggest red flag was there for all to see in the form of inbuilt tools that made selling of tokens far harder than buying them.

Squeed coin series#

It quickly gained traction among users, many of whom thought there was an association between the project and the recent Netflix hit series, “Squid Game”. Squid was billed as a token that could be used for a new online game inspired by the Netflix series - which tells the story of a group of people forced to play deadly children's games for money. 'Play-to-earn' cryptocurrency is where people buy tokens to use in online games and can earn more tokens which can later be exchanged for other cryptocurrencies or national currencies. SQUID began trading on PancakeSwap, a decentralized exchange. A similar rug-pull occurred earlier this year with Mando, a cryptocurrency that used images from Disney+’s Mandalorian TV show-without permission from Disney, of course. Another notable recent example amongst many saw the creator of SushiSwap, another highly touted token, disappeared with $13 million in September 2020 in what investors feared was a “rug pull.” The creator ended up returning the coins after an outcry, but then disappeared soon afterward. This is just the latest example of scammers utilizing pop culture to get media attention. “Media coverage failed to point out that there was no official tie-in with the Netflix series, thus providing an unwarranted veneer of respectability” CoinMarketCap also warned potential investors that SQUID was probably a scam, displaying a warning to 'exercise extreme caution' if they bought the crypto, but that didn’t stop mainstream news outlets like the BBC, Yahoo News, Business Insider, Fortune, and CNBC from running headlines about how the new Squid Game cryptocurrency had soared by 83,000% over just a few days. Squid's developers have made off with an estimated $3.38m (£2.48m), according to technology website Gizmodo, it had also pointed out numerous signs that the coin offering was a scam, including its (now disappeared) website being filled with spelling errors. “Rug pulls happen when there are large holders of the coin who can freely trade it, and the market for that token is not deep or highly liquid” This is commonly called a “rug pull” by crypto investors, it’s an event that is triggered because the creators of the crypto quickly cash out their coins for real money, draining the liquidity pool from the exchange. Squid coin, which marketed itself as a 'play-to-earn cryptocurrency', had seen its price soar in recent days - surging by thousands of per cent, the cryptocurrency peaked at a price of $2,861 before plummeting to $0, according to the website CoinMarketCap.