A token promoted as a play-to-earn token by the name squid game (SQUID) is getting the attention of the cryptoverse and mainstream media, after seeing a continuous, and rather unnatural, rise in price since its launch earlier this week. However, a quick look at the token’s website brings multiple red flags, while at least one company from their partner's list denied the partnership.
After going live on Binance Chain’s PancakeSwap decentralized exchange (DEX) at a price of USD 0.01 on October 26, SQUID was at the time of writing (14:24 UTC) trading at USD 7.55, up more than 45,000% since its inception.
Over the past 24 hours, the price was up 222%, with the number continuously moving higher. The 24-hour trading volume surpassed USD 9m, per CoinMarketCap data.
Unfortunately for buyers, there is a problem with the token, seemingly inspired by the Korean drama series Squid Game on Netflix, with several users reporting that it is impossible to sell it on PancakeSwap.
Not surprisingly, the situation may become a major deal-breaker for token holders, given that PancakeSwap is the only market where the token is traded at the moment.
“We have received multiple reports that users are not able to sell this token in PancakeSwap. Please exercise caution while trading,” the major coin tracking website CoinMarketCap warns its users on the token’s page, adding that "This project, while clearly inspired by the Netflix show of the same name, is unlikely to be affiliated with the official IP."
Meanwhile, not being able to sell the token would also explain why the price has only moved in one direction – up!
SQUID price since inception:
Source: CoinMarketCap
Judging from the project’s website, the SQUID token and the related game is likely a scam, with key team members listed as “CEO”, “CMO”, and “CTO” nowhere to be found online or on social media.
Source: A screenshot of the token's website
Further, the project’s website claims that it has a “partnership” with Netflix, Microsoft, CoinGecko, and several other well-known brands, which there is no evidence to support.
Source: A screenshot of the token's website
CoinGecko told Cryptonews.com that they have no partnership with this project. We have contacted Netflix for comment too.
According to the project’s white paper, the squid token has “an innovative anti-dump mechanism” built into it that prevents the price from dropping, with “selling credits” necessary to obtain in order to sell tokens.
And for those wondering why other liquidity pools have not been set up for token holders to sell, the white paper answers that too:
“Only SQUID-BNB in PancakeSwap is officially supported, which means you can only choose to swap SQUID for BNB in PancakeSwap. Users who add any other liquidity pairs will be punished.”
The SQUID token is allegedly based on six online games, all with the goal of winning prize money.
Worth noting is that all of the online games require players to pay “entry fees.” At current SQUID prices, these fees can add up to rather substantial amounts, with 15,000 SQUID, worth more than USD 107,000, necessary to enter Level 6 of the game.