Luke Hartford, a structural engineer from Sydney, Australia recently came across a tweet by someone named Jonhree112. The user called for attention to the new cryptocurrency on the rise. It increased 1,000 percent1 in price and everything promised to get up to the whole 200 percent. At that time each coin cost 72 cents. The latest Netflix series Squid Game had no official connection with this crypto. Even though many feared it was a scam it took $3.36 million of investments.
Squid Game crypto scam played everyone
Hartford initially invested $300 and to a certain degree he could be almost a millionaire. Only if it was not a scam. But Hartford doesn’t hold grudges. He says certain things you have to expect to be in an unregulated field like this. Before making an investment he checked the info with the BscScan. It registers all transactions on the Binance platform. Several comments warned that this might be a scam. Everything seemed too good to be true. But Hartford ignored that just for the sake of the doubt.
Just after 1:38 pm UTC on November 1, $3.36 million that had been invested into Squid Game coin was pulled out from. The liquidity pool in the exchange vanished immediately, and within 10 minutes the coin was nearly worthless, trading at one-third of a cent.
“Anyone can spin up a token and liquidity pool, so it is a common risk for new projects run by anons,” – Patrick McCorry, formerly an assistant professor in cryptocurrencies and security engineering at King’s College London and CEO of PISA Research.
Squid Game crypto scam: How it worked?
The way the Squid Games coin scam worked reminded a lot of people of a Ponzi scheme. It exploits the liquidity pool that exists between the Squid tokens issued and commensurate tokens (BNB tokens) issued by Binance, the cryptocurrency exchange. The scammers behind the Squid Games coin issued their tokens and withdrew the majority of the supply. That granted them the transfer of the value of the Squid Games coins into BNB tokens, which they subsequently pulled out. It`s now hard to trace them back as they used a mixing and tumbling service called Tornado Cash to obscure their tracks.
The project’s creators did not respond to a request for comment sent by Wired to a support email attached in the white paper used to promote their project. But the Squid Game coin scam isn’t the first time when scammers fleed with the funds. One of the recent examples can be named the SushiSwap highly touted token. That time in September 2020 $13 million disappeared. Creator returned the coins and soon vanished afterwards. Earlier, the WHALE token did the same trick. At night, its price vanished, together with its creators who took the money.
Be very careful when choosing the assets to invest your money in. Cryptocurrency markets are not controlled by any sort of authorities, so fraudsters are free to start their activity. When it comes to investing in meme tokens, like Shiba-Inu or DOGE, keep in mind that your money may cease to exist one time. All investing instruments have a certain risk of money loss, but some of them have almost 100% of it. Choose wisely – so you will not spend a lot of money on lawyers or hair dye to hide gray hair.
- SQUID token price on CoinMarketCap.