BIC’s Video News Show: Squid Game Crypto Debacle

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In Brief
  • In this episode of BeInCrypto’s Video News Show, host Jessica Walker dives into controversy surrounding the Squid Game cryptocurrency.

  • The value of the Squid Game coin has collapsed 99.99% to less than three cents per coin, down from over $2,850 at one point on Sunday.

  • Although it's unclear what happened to the crypto, traders speculate that the developers abandoned the project and stole the funds invested in it.

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In this episode of BeInCrypto’s Video News Show, host Jessica Walker dives into controversy surrounding the Squid Game cryptocurrency.

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The price of a new cryptocurrency inspired by the hit Netflix series “Squid Game” has collapsed in value in an apparent scam after skyrocketing more than 300,000 percent in its first week of trading. At the time of recording, the value of the Squid Game coin has collapsed 99.99% to less than three cents per coin, down from over $2,850 at one point on Sunday, according to data from CoinMarketCap.

Warning flags

In a major red flag, the site issued a warning to investors that holders of the coin aren’t able to sell it on Pancakeswap, a popular decentralized exchange. “We have received multiple reports that the website and socials are no longer functional & the users are not able to sell this token in Pancakeswap,” CoinMarketCap said.

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They also warned investors in the coin with the SQUID ticker to do their own due diligence and exercise extreme caution. They also added that the project, while clearly inspired by the Netflix show of the same name, is not affiliated with the company that owns its intellectual rights. The site started flashing warnings to users after some users were unable to sell it, but the developers of the project said that was by design as part of an “anti-dump mechanism.”

Twitter closed

In another red flag tied to the crypto, the now-deleted white paper for the project included grammatical errors, which has been a bad sign in previous scam cases. The collapse in value of the crypto came hours after Twitter flagged accounts associated with the crypto as suspicious and restricted access to them.

“Caution: This account is temporarily restricted,” Twitter warns users when they try to access any of the accounts associated with the crypto, which was purportedly meant to be used in a virtual game mimicking its namesake show.

Since Twitter began flagging the accounts, the developers of the crypto also deleted the white paper that was associated with it, as well as a website on which it was selling NFTs, also associated with the game.

Rug-pull?

It’s not clear exactly what happened to the crypto, but traders speculated on social media that it was a classic so-called rug-pull scam in which the developers of a crypto abandon the project and steal the funds invested in it.

According to CoinDesk, the developers behind the project said Monday on their official Telegram channel that they didn’t want to continue running the project due to the stress of dealing with hackers.

“Someone is trying to hack our project these days. Not only the Twitter account @GoGoSquidGame but also our smart contract. We are trying to protect it but the price is still abnormal. Squid Game Dev does not want to continue running the project as we are depressed from the scammers and is overwhelmed with stress [sic]. We have to remove all the restrictions and the transaction rules of Squid Game. Squid Game will enter a new stage of community autonomy,” the project reportedly said. 

Gizmodo reported that the developers likely made off with an estimated $2.1 million.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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