Squid Game (SQUID), a relatively new crypto project inspired by Korean hit series on Netflix, has crashed in what is one of the most high-profile collapses in the crypto space this year. A report unveiled this news earlier today, noting that the coin surged as high as $2,861.80 on November 1 before collapsing to zero on the same day.
According to the report, the SQUID project went live on October 26, promoting the token as a play-to-earn cryptocurrency. Following the success of the Squid Game series, the project quickly attracted a multitude of retail investors who pumped their funds into coin with hopes of making quick money. As a result, the coin’s price rose from $0.01 to $38 on Sunday, October 31.
Following the rapid growth, more investors bought the coin, pushing the price to $90 on Monday, November 1. This price action triggered a massive buying force that pushed the token to $2,861.80. However, before investors could withdraw their funds, SQUID crashed to zero almost instantly.
Upon further investigation, it became evident that the sudden drop was indeed a rug pull. According to data from BscScan, the entire SQUID valuation was withdrawn in a single transaction of 6,139.80 BNB, worth over $3.4 million.
A case of ignoring red flags
After the rug pull, investors cried foul, with no one coming to their rescue. An example is John Lee, a 30-year-old Filipino that invested $1,000 into the fraudulent crypto. Before realizing what happened, Lee was over the moon as his investment expanded rapidly. However, Monday came, and he witnessed his entire investment disappear in a matter of minutes.
Adding salt to the wound, Lee and other investors could not salvage their holdings due to measures that the project’s developers had implemented. From the start, SQUID investors complained that they could not sell their tokens via Pancake Swap, which was the only available market.
Explaining why investors could not cash out, the developers said they had implemented anti-dumping technology to prevent people from selling their holdings when demand is low. While this was a glaring red flag, investors looking to get rich quickly continued buying the token before their efforts culminated in losses.
A substandard Whitepaper
In its whitepaper, Squid Game noted that it had partnered with Netflix and Microsoft. With renowned crypto companies striving to forge partnerships with mainstream companies and still not achieving much, it begs the question of why investors continued investing in SQUID despite publishing unfounded claims of its collaboration with Microsoft and Netflix.
Apart from these unfounded claims, the document was also full of spelling mistakes, another red flag that investors ignored.
Reportedly, the project’s website, squidgame.cash, has since vanished. Additionally, all SQUID social media handles have gone dark. With these developments, many investors, including Lee, have come to terms with the fact that they will never see their hard-earned money again.
“It was shocking but I know that in crypto, there is a huge risk involved, including dealing with scammers. It was a good lesson.”