Squid Game token was lured many investors into its fraudulent lair, seducing buyers with its buzzwordy name inspired by the ultra-popular Netflix show. On its now-defunct official website, the cryptocurrency's developers falsely claimed to be partners with the streaming giant as well as Microsoft and OpenSea (an NFT marketplace).
As Squid Game token skyrocketed from 10 cents on Oct. 27 to a shocking $2,861 on Nov. 1, holders scrambled to sell the token. Unfortunately, many couldn't secure their profits. The deceptive developers sold their share of tokens and fled, sending the price plummeting to a near-worthless value.
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The duplicitous developers, of course, are the main perpetrators here; what they did was heinous. However, investors need to take some responsibility here, too. All signs were pointing to, "this is a scam!"
Squid Game token: Signs of fraud were glaring
I often enjoy checking the "Biggest Gainers" list on CoinMarketCap, which features a compilation of tokens that have the greatest growth within the past 24 hours.
On Oct. 28, my jaw dropped when I saw that a token called Squid Game increased by more than 17,000% in one day. I was flabbergasted! The chart showcasing its price history, however, seemed extremely fishy. It revealed that there were very few sell orders, which was odd. "The price is skyrocketing, but people aren't selling? That's strange," I thought. I then spotted a CoinMarketCap message that confirmed my suspicions: "We have received multiple reports that users are not able to sell [Squid Game] token in PancakeSwap. Please exercise caution while trading!"
Now if that isn't a massive "Something is wrong here!" sign, I don't know what is. I decided to check Squid Game token's official page, and it was filled with hogwash and deception.
As mentioned, the developers also claimed to have partnerships with Netflix, Microsoft, OpenSea and several other companies. As far as I could tell, neither of these companies made an official announcement unveiling their shiny new Squid Game token.
The developers even added a "Members" section to the website to make their crypto project seem legit, adding that David Kanny, a man with a five-year tenure at Netflix, is the "CEO" of Squid Game token. A quick LinkedIn search shows that the whole team section is fabricated.
The creators even claimed that Elon Musk shilled Squid Game token on Twitter, but of course, the Tesla CEO did nothing of the sort.
2 things to notice in their homepage:- they're using actual show videos in here (DMCA takedown incoming)- there's a basically random reference to Elon Musk, though there's never been explicit affiliation - when this happens it's usually a scam pic.twitter.com/DY99HWfpInOctober 29, 2021
Why Squid Game holders couldn't sell
As CoinMarketCap pointed out, the developers didn't necessarily block investors from selling, but they did make the process maliciously difficult. Here's where things get a little twisted — just like the eponymous show. The creators actually launched two tokens: Squid Game and Marbles.
In order to sell Squid Game, holders must also accrue a cryptocurrency called Marbles, which can only be earned by playing the project's play-to-earn game. The entry fee for first-time players is a whopping 456 SQUID. As such, if SQUID is valued at $1, one must shell out $456 to participate. When SQUID surged to $2,861 on Monday, the entry fee would have been an eye-watering $1,304,616.
"This structure meant many people ended up trapped. For a chance of getting their money back, they would need to have a balance of at least 456 SQUID, which in some cases was vastly more than their initial investment," CoinMarketCap said.
If the holders played the game and failed a level, they'd lose their 456 SQUID. Investors only had two choices: accept the fact that they can't sell or potentially dig themselves into a bigger hole.
After hitting an all-time high of $2,861 at 5:35 a.m. ET on Nov. 1, the price dropped to a devastating $0.0007926 five minutes later. The creators fled with their tokens, leaving investors high and dry. However, I can't help but feel baffled as to how so many investors missed the signs.
$squid game token live crash from 3k to nothing 🔻🔻📈📈🥶$squid $token #SquidGames #memecoin pic.twitter.com/M06VEmO8FzNovember 1, 2021
With a quick Google search, one can easily debunk many of the website's false claims, including the token's supposed affiliation with Netflix and Microsoft. Secondly, CoinMarketCap (a popular destination for investors who need insight into a specific cryptocurrency) announced that SQUID owners couldn't sell. Lastly, the white paper (a document that outlines a token's mission) is filled with misspellings and grammar mistakes — a telltale sign that something is amiss.
It's easy to get swept up into the excitement of a brand new token that bears the same name as the hit Netflix show, but this Squid Game token saga is a cautionary tale about what could potentially happen if you blindly purchase cryptocurrencies sans researching them.
Squid Game token isn't the only cryptocurrency that used a popular show to lure victims into its lair. Early this year, a scam token called Mando, inspired by Disney's The Mandalorian, also seduced fans into its trap.
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Kimberly Gedeon, holding a Master's degree in International Journalism, launched her career as a journalist for MadameNoire's business beat in 2013. She loved translating stuffy stories about the economy, personal finance and investing into digestible, easy-to-understand, entertaining stories for young women of color. During her time on the business beat, she discovered her passion for tech as she dove into articles about tech entrepreneurship, the Consumer Electronics Show (CES) and the latest tablets. After eight years of freelancing, dabbling in a myriad of beats, she's finally found a home at Laptop Mag that accepts her as the crypto-addicted, virtual reality-loving, investing-focused, tech-fascinated nerd she is. Woot!