Surely each of us has heard of the Squid Game series. It tells the invented story of South Korean bankrupts who have to take part in a series of childhood games in order to gain wealth. Well, in reference to the series, a token was created, which as many indicate was a giant scam.
The idea of the SQUID token
A group of programmers, following the idea taken from the series, decided to create a game called Squid Game. As they assured, in contrast to the plot straight from the Netflix production, here no one would suffer in any way.
The game was based on a prize pool created from SQUID tokens. Each participant, entering subsequent levels of the game, had to pay a fee consisting of an increasing number of tokens. These in the final settlement were to be divided into 10% for developers and 90% for the best player.
Great marketing drove the price action
International marketing in the form of a series, which was created long before the game project saw the light of day, perfectly fueled the price action of the token. As a result, as recently as October 28, SQUID cost less than $1, to reach as high as $2,861.80 at its peak and literally lose 99.99% of its value in a moment.
At the same moment the developers of the game disappeared and their website and Twitter account were blocked. This was, of course, the so-called rug pull, i.e. the abandonment by the creators of their original project, and the withdrawal of all previously raised funds. It is estimated that their profit could have been as high as $3.4 million.
There were many warning signals
Certainly, the parabolic movement of the price on the chart is something that pleases the eye. It also causes many people to want to take risks and jump on the long-running train as a result of FOMO. Even though you couldn’t liquidate your own SQUIDs due to the anti-dumping mechanism imposed by the developers, this didn’t prevent more people from successfully purchasing it. Thus, the price rose at an alarming rate until the solstice occurred.
What is interesting, despite the fact that the value of the token has fallen almost to zero, and the project is no longer supported in any way, in the first days after the rug pull we observe subsequent increases on SQUID, even amounting to several hundred percent.
Another important thing was the token’s website, which due to numerous errors in both spelling and grammar should suggest danger. But with the price going up and the train leaving, did anyone still look into it before buying SQUID?
Is there a lesson we can learn from this?
Cases like SQUID are not isolated. It should be remembered that the first of the analysis of any project whose token we wish to purchase should be a fundamental analysis. It evaluates the validity of the existence of the idea and definitely must have a convincing basis. Another important thing is the possibility of selling the acquired funds. When it turns out that this one is blocked, we should consider many times whether it is worth the risk. After all, no one wants to find themselves in a similar situation as the characters in the series before the game.