Meme coins are joke tokens quite popular in the cryptocurrency world. These tokens carry no fundamentals or utility and derive traction from the meme’s popularity on which they are based and the community’s support. Often these meme coins are mere pump and dump schemes where the hype around a coin is created first, and then the coins are dumped in the market. One such coin was the Squid Game crypto. Let’s learn more about the meme coin and the controversy surrounding it.
The Story behind Squid Game Cryptocurrency
The Squid Games crypto, better known as the ‘Squid Token’, was a cryptocurrency developed by someone that, to this date, remains anonymous. They followed almost the same pattern as actual games. First, you would have to participate in a presale, and the ten most expensive placeholders would get validated and they will go to the next level. Then there would be games that the placeholders would play, and whoever won any of the top three positions would gain points; in the end, the three placeholders with the highest point valuation would win and split the prize money.
This cryptocurrency was created to take advantage of the popularity of the South Korean drama series by the same name. The project was well-received by the masses and garnered a lot of success. The coin even reached $2,86 1 at one time.
Later on, though, the coin proved to be a rug pull scam. When its valuation dropped to $0, the creators of the token had taken advantage of the show’s hype. And when the coin reached a certain value, they quickly exchanged the profits from crypto for real-life money. This was done by using a website called Tornado Cash, which privatizes your transactions on the blockchain, effectively hiding whatever you do to the funds on the blockchain. They fled with all of the profit worth $3.38million while investors were left reeling under the losses.
What exactly happened with Squid Games Crypto?
The Squid Game Crypto quickly rose to popularity and had more than 40,000 tokenholders. The website which the scammers set up for Squid Games Crypto had guidelines and regulations and seemed legit for the most part. The whitepaper even stated that “Liquidity (shares) of SQUID will be locked for a minimum of three years on DxSale, preventing any unseen and immediate changes to SQUID liquidity pool. Unlock date is set for 20th October 2024.” The creators even had social media accounts where the Squid Games Crypto was heavily promoted.
Even though it seemed to be legit, there were warnings by many as there was no apparent verification from the creators of the show or Netflix that the ‘Squid Token’ was made in collaboration with them. The website that did not seem suspicious for the most part also presented minor red flags with the way the content that was presented on the website was filled with spelling errors.
Another thing that should have been seen as a top-off for potential buyers was the fact that it might have been easy to purchase the squid game crypto but to sell it, it was a mandatory requirement that you would have to purchase another token called ‘Marbles.’ The process of selling was much harder and made almost impossible in comparison to buying it.
Of course, all of this still did not stop many investors from purchasing the ‘Squid Token’ and taking part in the whole process set up by the creators. Everything seemed good until one day, suddenly, the value was at $2,861, and the very next, it dropped down to $0. The creators had scammed everyone by cashing out the cryptocurrency for real-life money and had managed to get away with one of the most major scams in the crypto world.
Blockchain exists so that third parties are not involved, and the seller can connect directly to the buyer and vice versa. This extra step that was put in place, asking sellers to invest in another crypto before selling the ‘Squid Token,’ is pretty uncommon and should have acted as a fair warning to everyone buying or selling the Squid Games Crypto.
Why did the scam happen in the first place?
This is not the first instance where scammers have taken advantage of the blockchain’s anonymity. The Squid Game Crypto is just one of the many rug pull scams where creators of false crypto have taken advantage of popular shows and movies and made millions of dollars, stolen them all, and gone without facing any actual consequences.
‘The Mandalorian’, a popular show made in connection with the Star Wars Franchise, gained popularity just like ‘Squid Games’ and faced something similar. The scammers made a cryptocurrency called ‘Mando’ and used images from the show without legal permission from the creators or Disney+, where the show aired. They used the show’s popularity and created the crypto at the peak of the show’s rise to success.
Clever tricks like this are always used to attract potential buyers under the guise that they are investing in something connected to a show or a movie. Media – whether print or visual – should also make it a point not to promote such projects that have shown signs of a scam. Instead, they should warn people to be wary of such projects.
You should always be careful when purchasing and selling cryptocurrencies and ensure that whatever you are spending and investing your money in is verified and provides you with active profit. The anonymity can act as an asset and a con for everyone dealing in the crypto business, so all need to be actively aware of whatever they invest in.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn’t represent any investment advice or WazirX’s official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.