Developers rugpulled after the token skyrocketed
Squid Game-inspired meme token has seen it’s value drop 99.99% in a matter of minutes, from a $2860 high to just a fraction of cent. The website of the SQUID token project has been taken offline, suggesting that the developers cashed out and took as much money as they could get.
Investing in crypto meme tokens can be very similar to playing red light, green light. Move too long and you get shot. Riding the waves of the popularity of the Netflix TV series, a Squid Game token emerged last week on Binance Smart Chain. The token tied in with a play-to-earn game.
The SQUID token hit the market on Tuesday, valued at $0.01. The token is tied to a play-to-earn platform, allowing users to participate in six different games. Participation in the first round required a deposit of 456 SQUID, which was $4.56 at launch. Each round the entry fee gets more expensive, reaching 15.000 SQUID for the sixth round.
In just 3 days the token increased 33.000% in value, hitting $3.37. However, over the weekend there were already reports of players being unable to cash out their earnings. Supposedly this had something to do with the anti-dump feature built-in to the smart contracts.
At the same time the value of the token kept increasing. On Monday the value of the SQUID token shot up from $38 to more than $2860. After that, within a few minutes, the token value dropped massively to $0.00079. This looks like a typical rugpull, where the anonymous developers remove all money from the project and take everything offline.
At this moment a total of 40.924 wallets contain 1 or more SQUID tokens, and the majority of them will have lost money on this scam. We could hope for law enforcement to jump in, but it would be much better to take responsibility.
Lessons to be learned? There were various alarm bells. For starters, the project used a brand name without official licensing. In addition, the developers were completely anonymous without an established reputation in the wider community. Furthermore, they implemented an anti-dump mechanism that would only allow a select number of users holding a specific token to sell in the SQUID/BNB pair on PancakeSwap. Those who were not in the know and simply bought SQUID became victims.
It’s worth noting that there are more Squid Game-inspired tokens on the market. None of them are officially affiliated with Netflix or the producers of the TV series. Do your own research, and don’t invest more than what you’re able to lose.