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This article is more than 2 month old.

Shanghai investor loses $28,000 life savings in Squid Game crypto scam

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The Squid token reached a dizzying price of $2,800 within a week of its existence before reports of investors being unable to sell the coin, the suspension of the coin’s Twitter account, discrepancies in the token’s whitepaper and website made people realise that it was a ‘rug-and-pull’ job. And prices crashed in seconds.

Shanghai investor loses $28,000 life savings in Squid Game crypto scam
An unsuspecting investor lost $28,000 in the recent cryptocurrency scam involving the Squid token, reported CNBC. The cryptocurrency based on Squid Game, Netflix's biggest show, had taken the cryptocurrency market by storm, rising over 2,400 percent in 24 hours on October 28, taking its market cap to $174 million, a report on CNBC said. But soon, after reaching a high of $2,800 the coin crashed to almost zero in value.
For Bernard, a Shanghai-based investor, this seemed like a golden opportunity to invest $28,000 of his life savings. But he lost all of his money as the coin crashed over revelations that the token was not affiliated with the official IP and discrepancies were spotted in the meme coin’s whitepaper and website.
“My rush to buy this token is for a single idea that went into my brain that Squid Game is very, very popular now, and its token must be popular now,” said Bernard wishing to be identified by his English first name because trading cryptocurrency in China is not quite legal.
“It’s a tragedy. I don’t know how to recover my loss.”
"Like many internet scams, cryptocurrency scams align themselves closely to popular trends and after the hype of Squid Game, this is no different," said Jake Moore, cybersecurity specialist at cybersecurity firm ESET.
The Squid token project was touted as a crypto play-to-earn platform where users can participate in the show's six game-themed rounds. Prospective players needed to pay a pre-set price in squid tokens in order to participate, with the final round costing 15,000 Squid tokens or $42,000,000 at the height of the token’s price. The developers had said 10 percent of these would go to the devs while the other 90 percent would go to the price pool.
With the project now defunct, it is difficult to estimate how much money the people behind the tokens managed to collect. Transaction records from BscScan appear to show that the developers were able to make at least $3.4 million in funds from unsuspecting investors.
“Squid Game Dev does not want to continue running the project as we are depressed from the scammers and is overwhelmed with stress,” the developers posted on November 1 on their Telegram channel.
The token’s website and whitepaper have been taken off, but can still be accessed through internet archives, while the token’s Twitter account was flagged and temporarily suspended for suspicious activity. Many investors have blamed media organisations for further hyping up the token.
“In this trading space, everyone will rush,” said Bernard, “and sometimes you feel FOMO.”
While some investors may try to get some respite by contacting US authorities, for investors like Bernard who are investing from countries where cryptocurrency trading is either banned or in a grey legal area, there aren’t many options.
 
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