The $SQUID token – which was used in a round of an associated game – is known as a ‘play-to-earn’ cryptocurrency, where people buy tokens to play an array of games on the platform.
A flurry of investors started to jump on the token following its launch on October 27 and play the game while also chasing a quick profit.
The price of $SQUID reached a peak of $2856 before crashing straight to zero Source: CoinMarketCap
A number of repeated warnings across social media and the crypto community also appeared to warn investors away from the project due to the risk involved.
However, despite the warnings, investors continued to pile money into the project and risk their capital in the speculative game.
CoinMarketCap even posted a notice on its token page for $SQUID, which informed users the coin may be a ‘honeypot’ scam.
Then, much like the TV show’s ‘Red Light, Green Light’ contest, the colours on the charts changed quickly and the price dropped sharply after reaching a peak of approximately $2,850 – with the price crashing to zero after the game developers seemingly removed the liquidity and ‘rug-pulled‘ the project.
Based on wallet activity, it’s alleged that the developers of the game walked away with approximately $2.5m of untraceable BNB after using Tornado Cash – a site used to privatise and hide transactions on the blockchain – to ‘clean’ the stolen funds.
The game’s website, Twitter and other social media platforms have now all been deleted.