Late last year the cryptocurrency Squid burst on to the scene with much fanfare and ended up spraying a lot of red ink.
Inspired by the Netflix series “Squid Game”, Squid began trading at a price of just one penny and surged to $2,856 before sinking to the bottom of the crypto sea, after its anonymous founders cashed out.
More than 40,000 people still held the token after the crash and analysts believe Squid’s developers made off with $3.8 million.
The Squid scam has been described as a rug pull, where developers of a cryptocurrency project — typically a new token — abandon it unexpectedly, taking users’ funds with them.
In June 2021, self-made billionaire and Shark Tank star Mark Cuban took a hit on Titan cryptocurrency, which spectacularly lost all its value in a day.
Rug pulls were a big factor in 2021, accounting for 37% of all cryptocurrency scam revenue in 2021, compared with 1% in 2020, the data firm Chainalysis said.
Many social media influencers, celebrities and even executives have been paid to pump tokens or projects online. But that doesn’t mean it’s valuable or a good investment. Feeding into social media hype will often result in money lost, experts say.
Kim Kardashian, boxer Floyd Mayweather, and basketball player Paul Pierce were sued earlier this week by investors, who accuse them of collaborating with the cryptocurrency EthereumMax to deceive them.
The class action claims EthereumMax operated a “pump and dump” scheme – where misleading…