The anonymous hucksters behind a Squid Game cryptocurrency have officially pulled the rug on the project, making off with an estimated $3.38 million. Remember on Friday morning when Gizmodo told you it was an obvious scam? It was only obvious because investors could purchase the crypto but couldnât sell it. But plenty of people didnât get the warning in time.
The SQUID cryptocurrency peaked at a price of $2,861 before plummeting to $0 around 5:40 a.m. ET., according to the website CoinMarketCap. This kind of theft, commonly called a ârug pullâ by crypto investors, happens when the creators of the crypto quickly cash out their coins for real money, draining the liquidity pool from the exchange.
The SQUID crypto coin was launched just last week and included plenty of red flags, including a three-week old website filled with bizarre spelling and grammatical errors. The website, hosted at SquidGame.cash, has disappeared, along with every other social media presence set up by the scammers. You can see an archived version of the website here.
Other red flags included the fact that SQUIDâs Telegram channel, set up by the unknown scammers, didnât allow comments from outsiders. And the Twitter account made it impossible for anyone to reply to posts.
But the biggest red flag was that no one who purchased the coin was able to sell. That didnât stop mainstream news outlets like the BBC, Yahoo News, Business Insider, Fortune, and CNBC from running headlines about how the new Squid Game cryptocurrency had soared by 83,000% over just a few days.
This is just the latest example of scammers utilizing pop culture to get media attention. A similar rug-pull occurred earlier this year with Mando, a cryptocurrency that used images from Disney+âs Mandalorian TV showâwithout permission from Disney, of course.
Does this mean that investors have finally learned their lesson and wonât invest in shady cryptocurrency projects anymore? That seems unlikely. Scam artists love the crypto space because itâs incredibly difficult to differentiate the scammers from someone whoâs earnestly trying to create a legitimate cryptocurrencyâperhaps because the idea of making your own currency is inherently fraudulent.
Thereâs a reason traditional currency has largely been the domain of governments throughout recorded history. Everyone participating in a given society needs to agree that a currency is worth something, and there are few institutions outside of government that can lend credibility to something so important. Libertarians will tell you otherwise, but weâll have to disagree on this one.
Does this mean you canât make money trading crypto? Obviously there are a lot of people making real dollars in the crypto space selling âmainstreamâ coins like bitcoin or even smaller coins like Shiba Inu, which has skyrocketed in price recently. But just because people are making money at it today doesnât mean itâll be around forever. Cryptocurrency will only survive if people have faith that itâs real money. And that sentiment can change from day to day.
If youâre going to buy cryptocurrency, the most important thing to look out for isnât necessarily the price. First, figure out whether you can sell the coin after you bought it. If you canât sellâlike the people who invested in SQUID discovered they canâtâit doesnât matter how high the price goes, just as it doesnât matter how large of a number someone writes on Monopoly bills.
Cryptocurrency is only worth what someone else is willing to pay for it. And if the rules say you canât even sell, youâve just been scammed. Sorry, folks.
Update: This post originally estimated the amount stolen at roughly $2.1 million. The amount was closer to $3.38 million.