Red Light, Green Light, Rug Pull: Squid Game Crypto Coin Developers Steal Millions in Scam
Capitalizing on the popularity of the show, developers saw a great opportunity to create a play-to-earn cryptocurrency called Squid. Released in October of this year, the value of Squid had skyrocketed over 23 million percent to about $2,860 per token with the promise that investors would be able to play a game inspired by the series wherein their only risk would be the tokens in play.
Although people didn’t put their lives on the line, what happened next cost some people their life savings. In the crypto world, it’s called a rug pull.
This is one of a few common crypto scams that you should be aware of, but there are a few notable features that can help you recognize a potential exit scam before they have a chance to end your magic carpet ride. In this malicious stunt, the creator of a token (or a developer) quickly liquidates the virtual tokens for cash, driving the token value into the ground while making off with the investor’s money. In this case, the rug was pulled to the tune of about $3.3 million.
While this came as an utter shock to those invested, experts in the world of crypto have alluded to the greater lesson to be learned here.
Apparently, there were a few red flags from the get-go that this stank of a potential scam.
- For starters, the white paper was riddled with spelling errors and unfounded affiliation claims.
- To make matters worse, Squid could not be sold once purchased. It was only when a specific ratio of buyers to sellers was met, that investors would be able to sell off their tokens.
- This anti-dump backup is exactly what allowed developers to make off with millions as investors sat around helplessly watching the value of Squid tank to virtually nothing.
This anti-dump backup is exactly what allowed developers to make off with millions as investors sat around helplessly watching the value of Squid tank to virtually nothing. To the trained eye, this was a project doomed from the beginning, but for those caught up in the hype, these details easily slinked by in the shadows.
The Moral Of The Squid Game Token Story
Always do your research. While the appearance of how legitimate a potential scam can look varies, there are often telltale signs to look for that can ensure educated investments.
Checking the white paper should be your first point of investigation – are there spelling mistakes? Are claims being made and affiliations verifiable? Is there information about the developer themselves, the long-term plans for the tokens, or the strategies and timeline for the project? If you’re looking at the white paper and it seems as though a child could do a better job, take that as a giant red flag.
If you do a quick search on the developer and a random guy’s Facebook profile pops up (or they’re basically non-existent to the internet) take your money and run.
You wouldn’t wish this kind of thing on anyone. But, the fact that this has now become one of the most notable rug pulls to date because of Squid Game’s clout has served as a bit of a silver lining. Knowing that there are potential risks involved, and knowing what to look for in exit scams is now headline news that could help millions of people make smarter investment decisions in the future. At the very least, we can rest assured knowing that those involved weren’t subjected to a game of marbles that ended in death.
