2021 Squid Game cryptocurrency scam explained

The 2021 Squid Game cryptocurrency scam was a significant fraudulent event that took place in the world of cryptocurrency.[1] Inspired by the popular South Korean Netflix series Squid Game, this cryptocurrency, known as Squid Coin,[2] promised investors an opportunity to play and earn. However, it quickly unraveled, leaving investors defrauded of millions of dollars.[3] [4] [5] [6] [7]

Background

In November 2021, Squid Coin gained sudden popularity, with its valuation soaring to $2,861 per coin. Marketed as a "play-to-earn cryptocurrency," it garnered immense attention and witnessed a meteoric rise in its price, surging by thousands of percentage points.

The creators of Squid Coin presented it as a revolutionary opportunity for investors to participate in an upcoming online game inspired by the Netflix series "Squid Game," in which participants compete in deadly children's games for money.

The mechanics of the scam involved enticing investors with the promise of earning rewards by purchasing Squid Coin tokens. Investors were led to believe that these tokens could be used to participate in the forthcoming Squid Game online platform, where they could earn more tokens through gameplay. These earned tokens were purportedly exchangeable for other cryptocurrencies or national currencies, further fueling the excitement around Squid Coin.

However, as the value of Squid Coin skyrocketed,[8] [9] concerns began to surface. Investors who had bought into the cryptocurrency soon discovered that they were unable to sell their tokens. This inability to resell raised significant doubts about the legitimacy of the project and started to sound alarm bells among cryptocurrency experts and enthusiasts.[10]

Then Squid Coin's value plummeted to zero, leaving investors with worthless tokens.[11] It became apparent that the developers of Squid Coin had quickly cashed out their holdings, draining liquidity from the exchange.

As the scam unraveled, investors were left with substantial losses, while the developers of Squid Coin disappeared from the public eye, taking an estimated $3.38 million with them.[12] The project's website, which had previously been active, disappeared along with its social media accounts, further erasing any trace of its existence.[13]

Warnings and disappearance

The absence of an option to sell the coin was a significant loophole that signaled trouble. Furthermore, the website contained numerous errors, and social media accounts associated with the project disappeared.

Notes and References

  1. Web site: Ponciano . Jonathan . Viral Squid Game Cryptocurrency Crashes 100% In Minutes After Founders Reportedly Run Away With $2.5 Million . 2023-10-07 . Forbes . en . 2023-10-07 . https://web.archive.org/web/20231007165900/https://www.forbes.com/sites/jonathanponciano/2021/11/01/viral-squid-game-cryptocurrency-crashes-100-in-minutes-after-founders-reportedly-run-away-with-25-million/ . live .
  2. How a Squid Game Crypto Scam Got Away With Millions . en-GB . Wired UK . 2023-10-07 . 1357-0978 . 2023-10-07 . https://web.archive.org/web/20231007165900/https://www.wired.co.uk/article/squid-game-crypto-scam . live .
  3. News: 2021-11-02 . Squid Game crypto token collapses in apparent scam . en-GB . BBC News . 2023-10-07 . 2023-10-10 . https://web.archive.org/web/20231010150431/https://www.bbc.com/news/business-59129466 . live .
  4. News: Yoon . John . 2021-11-03 . How investors lost millions in cryptocurrency inspired by Squid Game . The Economic Times . 2023-10-07 . 0013-0389 . 2023-10-07 . https://web.archive.org/web/20231007165900/https://economictimes.indiatimes.com/markets/cryptocurrency/from-2800-to-zero-in-5-minutes-how-investors-lost-millions-in-cryptocurrency-inspired-by-squid-game/articleshow/87501855.cms?from=mdr . live .
  5. Web site: 2021-11-05 . Amid 'Squid Game' crypto scam, here's how investors can keep frauds at bay . 2023-10-07 . mint . en . 2023-10-07 . https://web.archive.org/web/20231007165900/https://www.livemint.com/market/cryptocurrency/amid-squid-game-crypto-scam-here-s-how-investors-can-keep-frauds-at-bay-11636116434388.html . live .
  6. An analysis of consumer complaints related to crypto-assets . Consumer Financial Protection Bureau . 2023-10-07 . 2023-09-20 . https://web.archive.org/web/20230920010502/https://files.consumerfinance.gov/f/documents/cfpb_complaint-bulletin_crypto-assets_2022-11.pdf . live .
  7. Crypto Fraud Incidents on the Rise . HKA . 2023-10-07 . 2023-08-04 . https://web.archive.org/web/20230804050508/https://www.hka.com/wp-content/uploads/2021/11/Crypto-fraud-incidents-on-the-rise.pdf . live .
  8. Web site: 2021-10-30 . Squid Game cryptocurrency Squid rises 1,00,000% in a week, warning issued . 2023-10-07 . Hindustan Times . en . 2023-10-07 . https://web.archive.org/web/20231007165901/https://www.hindustantimes.com/business/squid-game-cryptocurrency-squid-rises-1-00-000-in-a-week-warning-issued-101635587776067.html . live .
  9. News: Nahar . Pawan . 2021-10-30 . 'Squid Game' mania turns Rs 1,000 into Rs 3.45 lakh in less than 100 hours . The Economic Times . 2023-10-07 . 0013-0389 . 2023-10-07 . https://web.archive.org/web/20231007165902/https://economictimes.indiatimes.com/markets/cryptocurrency/squid-games-mania-turns-rs-1000-into-rs-3-45-lakh-in-less-than-100-hours/articleshow/87367026.cms?from=mdr . live .
  10. Web site: 'Squid Game' cryptocurrency scams $2 million after creators vanish . 2023-10-07 . CNET . en . 2023-10-07 . https://web.archive.org/web/20231007165901/https://www.cnet.com/culture/squid-game-cryptocurrency-scams-2-million-after-creators-vanish/ . live .
  11. News: Cheng . Amy . 2021-11-02 . 'Squid Game'-inspired cryptocurrency that soared by 23 million percent now worthless after apparent scam . en-US . Washington Post . 2023-10-07 . 0190-8286 . 2023-11-15 . https://web.archive.org/web/20231115064935/https://www.washingtonpost.com/world/2021/11/02/squid-game-crypto-rug-pull/ . live .
  12. Web site: 2021-11-02 . Squid Game based crypto collapses in $3m scam . 2023-10-07 . Yahoo Finance . en-GB . 2023-10-07 . https://web.archive.org/web/20231007165903/https://uk.finance.yahoo.com/news/squid-game-crypto-collapses-in-3-m-scam-103431986.html . live .
  13. Web site: 2021-11-08 . Squid Game scam: Everything you should know . 2023-10-07 . cnbctv18.com . en . 2023-10-07 . https://web.archive.org/web/20231007165905/https://www.cnbctv18.com/cryptocurrency/squid-game-scam-everything-you-should-know-11380272.htm . live .

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