- A new token inspired by the Netflix series “Squid Game” scammed its investors.
- The culprits behind the rug pull took over $3 million.
- Some investors blame their own “naive” approach to possible “scammer type tokens.”
YEREVAN (CoinChapter.com) – The popular South Korean Netflix series Squid Game inspired a fresh concept for Halloween costumes and a new altcoin. The SQUID token gained popularity after its launch on Oct 20. However, it unexpectedly jumped 310,000% on Sunday, reaching over $2,800, only to hit the ground, leaving “naive” investors with nothing. The culprits scammed them for over $3 million.
Twitter users reported seeing the crash coming, as users could buy the token but not sell it. In addition, Twitter flagged Squid Game crypto’s “official” account as suspicious, temporarily restricting its activity.
Moreover, the whitepaper looked “fishy” and contained multiple grammar mistakes. Finally, the crypto data website CoinMarketCap warned traders against purchasing the token before the crash. The website claimed they received “multiple reports” on the no-longer-functional SQUID website and added that the project “is NOT affiliated with the official IP.”
Also read: Bitcoin (BTC) informational website hacked by scammers; domain disabled after over $17.8k theft
CoinMarkepCap also reported that despite the extreme volatility throughout the previous days, SQUID’s market capitalization hardly shifted from $11 million. The steady market cap indicated that the scam token’s surge didn’t match the rise in investor activity. The website called it a “classic sign of rug pull.”
A “rug pull” is when developers abruptly abandon a project — taking their investors’ funds with them. In the case of SQUID, they took $3.38 million.
Unfortunate SQUID investors
Cornell University economist Eswar Prasad commented on such scams, calling investors who get involved “naive.”
Remarkably, many such coins rapidly catch investors’ fancy, leading to wildly inflated valuations. Naïve retail investors who get caught up in such speculative frenzies face the risk of substantial losses.said the expert.
Moreover, the team behind the scam offered explanations for the abrupt value plunge, citing hacks.
Someone is trying to hack our project these days. Not only the Twitter account but also our smart contract. Squid Game Dev does not want to continue running the project as we are depressed from the scammers and is overwhelmed with stress.read the Telegram message in broken English.
The scam trapped many investors, as they were unable to withdraw their funds. Some described the experience as feeling”helpless.” They watched the investment grow by the minute and then crash to practically zero. One of the investors blamed the loss on themselves and media attention to the scam project.
I guess this will serve as a valuable lesson for me to not just jump into meme coins … I am not blaming anyone except myself, but I think there must be some mechanism to avoid this in the future, and for news outlets to stop giving attention to these scammer type tokens.said one of the victims.