It took only a few minutes for the Squid Coin (SQUID) to go from the hottest global gaining virtual currency to nearly zero. After Netflix’s online drama “Squid Game” exploded, the virtual currency market gave birth to a “Squid Coin” named after the brand. The currency started a skyrocketing mode, the highest increase in the past week reached 2,300 times, and the currency price reached an astonishing $2861.8 (about 18,309 yuan).
However, on November 1st, Eastern Time, the currency suddenly crashed, and the price of the currency fell directly to almost zero. As of press time, the price of squid coin fell to about 0.02 yuan, and the market value was only 5.87 yuan.
Image source: CoinMarketCap
Coin price crash
At 9:35 on November 1st, Eastern Time, after the Squid coin soared above US$2,850 in a short-term, it suddenly plummeted to almost zero in just a few minutes. Some investors said: “When you buy, it starts to fall, and it falls directly to a few cents before you can react.”
The white paper of the squid coin project shows that the project is a virtual currency game earning platform on the BSC public chain, inspired by the popular Korean drama of the same name by Netflix. The pre-sale of the currency began on October 20, and it was all sold out within 1 second.
According to media reports, the founder of Squid Coin has stated that the project is Netflix’s official token partner. And it has established a strategic partnership with CoinGecko, a virtual currency platform.
However, in an interview with the media, CoinGecko co-founder Bobby Ong refuted these claims: “Squid Coin does not meet our listing standards, so it will not be listed and traded on CoinGecko. This is likely a scam.”
In the days before the crash, investors complained that they could not sell their Squid Coins on Pancakeswap, the only virtual currency platform that could trade the currency. Subsequently, the founder of Squid Coin explained that because the project deployed an innovative “anti-dumping technology” that restricts people from selling tokens when demand drops.
As of press time, the reporter logged into Squid Game’s official website, and the display page could no longer be opened. Several social media platforms for the project displayed account restriction warnings. Its developer stated in the Telegram group that it would abandon the project: “Recently, it was maliciously attacked by hackers and tried to take over official Twitter and smart contracts. We worked hard to protect it, but the price is still abnormal. Squid Game Dev will not continue to operate the project. For the project, we are frustrated and pressured by scammers, and all restrictions and transaction specifications of Squid Game will be removed, and Squid Game will enter the stage of community autonomy.”
The founder ran away
According to media reports, the issuer of the project has already run away with money, and investors have lost at least US$2.1 million. Analysis shows that the founder of the project used the TornadoCash protocol to hide transaction details, thereby transferring funds and cashing out equivalent Binance Coin (BNB). The address has now been marked as “involved in a scam.”
On social media, some netizens exclaimed: “We have witnessed another runaway story”, and some netizens said with emotion that “cryptocurrency will probably be like this in the future” and “this coin itself is a squid game.”
According to media reports, the project had many flaws. For example, the official website was registered less than a month ago, and the total usage time was less than three weeks; there were many grammatical errors in the description of the project; the founder of Squid Coin did not have it on LinkedIn. Personal information, etc.
Earlier, the virtual currency data platform CoinMarketCap had issued a warning that the project was obviously inspired by the web drama of the same name by Netflix, but it is not an official IP. And the progress of the project is slow, investors are requested to make their own due diligence and invest cautiously.
The platform also stated that it has received multiple reports that users cannot sell the token on the exchange Pancakeswap. Squidcoin’s white paper does propose an anti-dumping technique. If certain conditions are not met, people cannot sell it. Therefore, buying this virtual currency is extremely risky. Many people think Squidcoin is a botched scam.
William, the chief researcher of Huobi Research Institute, said that this is a typical fraud incident that combines the current trendy and popular elements-pop culture and virtual currency. From the perspective of narrative economics, Squid Coin has made use of the global popularity of “Squid Game” and the hype in the virtual currency market to achieve “narrative” success and gain a far-reaching influence in dissemination. Other scam projects attracted more investors to enter the market, which eventually led to the harvest. Virtual currency fraud projects like this have three common characteristics: the identity of the developer is unknown; the website pages are poorly made; the total amount of virtual currency is opaque or the team holds a large number of chips to manipulate the market.
Virtual currency speculation has risks
Virtual currency, as its name implies, refers to non-real currency. Since May this year, the domestic regulatory policies on virtual currencies have continued to tighten, and the crackdown on virtual currency transactions has also been increasing.
On September 24, ten ministries including the Central Bank, China Banking Regulatory Commission, Cyberspace Administration of China, Foreign Exchange Bureau, Supreme People’s Court and Supreme People’s Procuratorate issued the “Notice on Further Preventing and Disposing of the Risks of Virtual Currency Trading Speculation”, which clearly stated that it is issued by non-monetary authorities. , Virtual currencies that use encryption technology, distributed accounts or similar technologies, and exist in digital form, such as so-called “stable currencies” such as Bitcoin and Ethereum, do not have the same legal status as legal tender, and cannot be used as currency. Circulate in the market.
According to analysis by industry insiders, there are many risks in the speculation of virtual currencies. Virtual currencies are susceptible to “Musk-style” speculation. Investors are “cut leeks” in a short period of time, thus incurring huge economic and property losses.
Dong Ximiao, chief researcher of China Merchants Union Finance, emphasized that the public should fully understand the nature and risks of Bitcoin and other virtual currencies, withstand the temptation, protect their wallets, and refrain from participating in any form of trading or speculation.