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December 30, 2024Beware of Squid Game Tokens: A New Wave of Scams Following Netflix’s Season 2 Release
With the highly anticipated second season of Netflix’s hit series Squid Game launching on December 26, 2024, a new wave of cryptocurrency tokens inspired by the show has flooded the market. As the show captivates global audiences with its dark take on competition and survival, many tokens with the same name are now being marketed to crypto enthusiasts.
However, some in the crypto community are raising red flags. While the show promises a massive cash prize for its contestants, those investing in Squid Game-themed tokens may find that their chances of winning are much slimmer—possibly even nonexistent. Scam tokens and rug pulls appear to be prevalent, and investors are being warned to tread carefully.
PeckShield Alerts on Scam Tokens
On December 27, the blockchain security firm PeckShield issued a warning to the crypto community about the surge of fraudulent tokens linked to the Squid Game brand. According to PeckShield, tokens with the Squid Game name are being widely circulated, but many of these are fraudulent or designed to deceive investors.
One particular token launched on Base, a layer-2 network, was flagged as suspicious. PeckShield noted that the deployer of the token was also its largest holder, a classic red flag in the crypto world. Since its launch, this token has already dropped by 99% in value, raising concerns that it could be part of a rug pull. Rug pulls are scams where developers abandon the project after attracting funds, causing the token’s price to plummet and leaving investors with worthless assets.
Similar Squid Game tokens have also emerged on the Solana network, further amplifying the risks to investors.
Warning Signs: Top Holders and Potential “Dumping”
One of the most concerning aspects of these tokens is how the holdings are distributed. A user on X (formerly Twitter), whose account was dedicated to tracking the Squid Game token, warned followers that the top holders of these tokens “all look the same,” meaning they are likely controlled by a small group of individuals. This is a common tactic in pump and dump schemes, where early holders—typically the creators or insiders—accumulate a large supply of the token and then sell it off once the price has been inflated by new buyers.
The potential for these early holders to dump their tokens once new investors buy in could leave the latter with significant losses, making these Squid Game-themed tokens highly speculative and risky for anyone considering a purchase.
The release of Squid Game season 2 echoes a similar situation that occurred in 2021, when the first season of the show inspired a wave of Squid Game tokens in the crypto space. One of these tokens skyrocketed in value, seeing gains of over 45,000%. However, it wasn’t long before reports emerged that users were unable to sell their tokens, particularly on decentralized exchanges like PancakeSwap.
As the situation unfolded, it became clear that the token was likely a rug pull—a scam where the creators abandoned the project after attracting investments, leaving holders with nothing. CoinMarketCap even issued a warning, informing users that they could not sell their tokens. This situation led to widespread skepticism about the legitimacy of the token and the safety of investing in Squid Game-themed projects.
Protecting Yourself from Scam Tokens
As the trend of Squid Game-inspired tokens continues, it’s important for investors to stay vigilant. Here are some key tips to protect yourself from scams:
- Do Your Research: Before buying any new tokens, ensure they have a legitimate development team, clear use cases, and a transparent roadmap. Avoid tokens that lack information or seem to have been launched without any community input.
- Check Token Distribution: Be cautious of tokens where the majority of supply is held by a small group of wallets or addresses. This could signal the potential for a pump and dump or rug pull.
- Use Reputable Platforms: Stick to well-known decentralized exchanges and crypto wallets with strong security measures. Avoid trading on platforms that are not widely recognized or have poor security histories.
- Follow Community Warnings: Stay active in the crypto community, where users often share warnings about suspicious tokens. Platforms like Reddit, X, and Telegram are good sources for real-time alerts.
- Be Skeptical of Quick Gains: High returns in a short time are often a sign of something too good to be true. If it feels like a “get rich quick” scheme, it probably is.
While Squid Game has captured the imagination of audiences around the world with its gripping storylines, investors should be cautious when navigating the sea of crypto tokens tied to the series. The warning signs of fraudulent tokens and rug pulls are already evident, and history has shown that these types of projects often end in disaster for unsuspecting investors.
If you’re looking to get involved in the crypto world, it’s essential to prioritize safety, do your research, and steer clear of tokens that seem too good to be true—especially those with flashy names like Squid Game. As the crypto space continues to evolve, protecting yourself from scams will remain a top priority for all investors.
