Viral Squid Game Cryptocurrency Crashes 100% In Minutes After Founders Reportedly Run Away With $2.5 Million

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The price of the viral cryptocurrency inspired by the popular Netflix show Squid Game was disrupted Monday morning after detailed reports of anonymous project founders pulling the plug on the token and fleeing with investor returns — the latest cautionary tale for traders trying to chase the emerging cryptocurrency market’s meteoric gains.

key facts

The price of the so-called Squid game token lost nearly all of its value around 6AM ET, dropping from a price of more than $2,861 to less than half a penny and wiping out $6 billion from the market value within 15 minutes, according to the coin data site. CoinMarketCap encrypted.

The crash started after users noticed wallet activity indicating that alleged token developers had finished the project before its highly publicized online game was launched, mining nearly $2.5 million worth of coins tokens, and hiding transaction details using a protocol called Tornado Cash.

The Squid token and social media accounts went offline after the incident on Monday morning; Twitter was already restricted His account was due to “unusual activity”.

Warning signals grew rapidly following the token’s meteoric rise last week, with CoinMarketCap warning on Friday that several users reported being unable to sell their tokens on the decentralized exchange PancakeSwap.

The site went on to warn that the project, although clearly inspired by the Netflix show of the same name, “is unlikely to be affiliated with the official [intellectual property], adding: “Please do your due diligence and be careful while trading!”

main background

Spurred by massive enthusiasm among retail crypto investors, the Squid token has surged as much as 310,000% since its launch just last week – even though little was known about the project or its founders. The cryptocurrency website claimed that its Squid Game-based online game will launch this month, but users soon noticed that the project’s whitepaper (common in the crypto industry for detailing token specifications) contained several grammatical and spelling errors, while its alleged founders did not. They don’t have a social media appearance. The token went on sale earlier last month and sold out in “a second,” the whitepaper claimed.

the shadow

Squid is not alone among the tokens that collapse to zero. In June, a cryptocurrency backed by billionaire Mark Cuban lost nearly all of its value after lower prices revealed a flaw in the token’s design that created an arbitrage opportunity, allowing investors to make virtually unlimited money by repeatedly buying and selling the token. So far, the cryptocurrency has not regained any value yet.

Huge number

$2.6 trillion. This is the value of the cryptocurrency market on Monday, according to CoinMarketCap, which has grown nearly sixfold in the past year thanks to increased institutional adoption and inflationary fears.

in-depth reading

Squid scammers make $2.1 million in profit (Gizmodo)

Cryptocurrency based on the ‘Squid game’ is on the rise (Forbes)

The new Shiba Inu? Serious Warning Issued About Viral Squid Game Cryptocurrency That Suddenly Rises Over 100,000% (Forbes)

Mark Cuban Hit After Crypto Crash 100% in One Day — And These Other Token Tokens Have Crashed As Well (Forbes)