Toward the end of December, Netflix released the second season of “Squid Game,” the most-watched series in the platform’s history. Soon after its launch, tokens referencing the dystopian thriller flooded the crypto market.
Just one day after the series launch, blockchain security firm PeckShield warned the community about the fraudulent nature of some Squid Game-inspired tokens.
Squid Game Tokens on the Rise
The Squid Game series depicts a high-stakes competition in which contestants, facing dire financial circumstances, risk their lives in pursuit of a substantial prize.
Following the renewed popularity of the “Squid Game” series after the second season launched on December 26, tokens bearing the series-inspired names quickly appeared on numerous cryptocurrency exchanges.
However, the rapid emergence of several Squid Game-themed tokens has raised concerns regarding their authenticity and the potential financial risks associated with investing in them.
On December 27, blockchain security company PeckShield warned about the integrity of different tokens, identifying them as potential frauds.
“Beware of scam SquidGame tokens circulating in the wild. We have detected a fraudulent #SquidGame token deployed on Base just 3 hours ago, with the deployer as the largest holder,” PeckShield said in an X post.
In that case, PeckShield flagged a particular token deployed on Ethereum’s Base platform, noting that its deployer held a significant portion of the supply. Since its launch, this token has experienced a 99% price decline.
Similar schemes on Solana exhibited suspicious behavior, such as identical top token holders, suggesting potential price manipulation and coordinated pump-and-dumps, which usually end in rug pulls.
Users have particularly pointed fingers at a Squid Game-themed account on X that has been aggressively promoting their token. Observers have noted an unusual consistency among the largest wallets holding this token, often indicative of a potential scam.
“Yes, these are the top holders. Yes, they look all the same. No, that is not a coincidence. Don’t get rugged,” said one community member.
Scams and hacks have been a constant challenge in the crypto space throughout 2024. Several high-profile social media accounts were hacked in the past few months to promote scam tokens, which initiated a rug pull as soon as unaware traders invested their capital.
Overall, crypto hacks and scams have cost the industry over $2.3 billion in 2024, a 40% increase from 2023.
A Similar 2021 Experience
This isn’t Squid Game’s first rodeo with crypto token scams. After the series launched its first season in 2021, certain token launches that started with hype ended in fraud. In a notable incident, a token called ‘SQUID’ experienced a rapid and significant price surge with gains exceeding 45,000%.
However, this rapid growth was soon followed by reports of investors being unable to sell their holdings on decentralized exchanges like PancakeSwap, prompting warnings from platforms like CoinMarketCap.
This incident, often cited as one of the largest rug pulls, highlights the risks associated with investing in speculative cryptocurrencies, particularly those with limited liquidity and transparency.
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