The emerging cryptocurrency token Squid game (SQUID) crashed on Monday after jumping more than 310,000% in value on Sunday night. The slump recorded 99.99%, according to the CoinMarketCap.
The token was made available for purchase on Oct 20, inspired by the popular Netflix series Squid Game, which collapsed less than two weeks after investors could start trading tokens.
SQUID lost all its value after Twitter flagged the cryptocurrency’s account and temporarily restricted it due to “suspicious activity”.
Surprisingly, the token’s website and social accounts have disappeared, along with a white paper describing the Squid, and the token’s value had spiked to $2,856 right before its collapse.
The idea behind the cryptocurrency was a pay-to-play token to play an online game inspired by Squid Game. In the hit Netflix series, heavily indebted people play bloody and deadly versions of childhood games to win cash rewards.
A fraudulent game was released in November, and its promoters said winners would be rewarded with more Squid tokens. But even as the cryptocurrency’s price spiked in value last week, many were sceptical and noted that the token could be fraudulent.
According to several reports, investors were having trouble selling their tokens, and they noted that the cryptocurrency’s white paper was littered with grammatical errors.
Reportedly, the creators of the cryptocurrency could have made off with as much as $2.1 million after the token’s crash, according to Gizmodo.
Reports suggest that CoinMarketCap, a cryptocurrency price-tracking website, had warned potential buyers to “please do your own due diligence and exercise caution while trading” and warning them that investors were having trouble selling their tokens.
An anonymous Squid investor told CoinMarketCap, “I lost all of what I had in this project” after investing $5,000 into the cryptocurrency.
Experts suggest investors should manage risks and avoid the collapse of uncertain tokens. Investors also should be careful when considering purchasing “meme” cryptocurrencies based on cultural phenomena, even if it appears the currency is doing well on the market.