Squid Game crypto news: Squid Game is memecoin warning with erasure after 230,000% gain
However, big gains are not taken for granted, especially in a market as wild, sprawling, and speculative as crypto. And inflation in value terms is often fleeting. As proof, there is Squid Game, or SQUID, the latest memecoin sensation, inspired by the Netflix hit. It jumped more than 230,000% last week to $ 2,861.80, according to prices from CoinMarketCap – to plunge 100% to less than half a cent on Monday in New York.
âBetting on the right coin can lead to breathtaking riches,â Antoni Trenchev, co-founder of crypto lender Nexo, said in an email Sunday. “The problem is, what goes up in a straight line tends to go back in the same way.” He added, âYou hear some memecoin investors don’t care about losses. They’re here for the ride â, butâ once the sale starts a cascading effect can occur, so it’s wise to only use the money you can afford to lose â.
Some digital assets have seen dramatic gains, with last year’s bull market extending beyond Bitcoin and Ether to other tokens, decentralized finance projects and more. Dogecoin, which started out in 2013 as a joke, has climbed 10,000% in the past year, according to prices from CoinGecko. Shiba Inu, which was established last year, has soared over 90,000,000%; it climbed 800 percent in October alone.
The rise and collapse of Squid Game reveals another side of the crypto frenzy: the potential for demand to suddenly dry up, or worse, for developers to abandon a project and run away with the funds in a scam. known as a rug sweater. Whether this is what happened with Squid Game is still unclear, but even before the downturn there were inconsistencies around trading. CoinMarketCap issued a warning stating that it had received “multiple reports” that users were unable to sell the token on PancakeSwap, a decentralized exchange.
âPlease exercise due diligence and exercise extreme caution. This project, although clearly inspired by the Netflix show of the same name, is not affiliated with the official IP, âhe says at the top of the SQUID page, referring to intellectual property.
Indeed, the Squid Game white paper indicates that it âwill implement an innovative anti-dumping mechanismâ. Buying in the market frees up âsales credits,â he says, but adds that if there is no more sales credit âin the pool,â no one will be able to sell anymore.
âThe reality is that very few retail buyers of these memecoins actually spend the time reading the white paper or trying to understand the symbolic and governance frameworks of these coins,â said Henri Arslanian, Leader and Partner. of PwC crypto. “And that comes with risks.”
It can even be difficult to know what to invest in, with crypto-opportunists creating tokens with similar names to frequent travelers. A search for “Floki” (that’s the name of Tesla Inc. founder Elon Musk’s puppy) on CoinGecko results in Floki Inu, Floki Musk, Shiba Floki, Baby Moon Floki, FlokiSwap, and FlokiMooni.
Some have suggested that there are broader societal reasons for the moves, which go hand in hand with Reddit-powered rides in actions like GameStop Corp. and AMC Entertainment Holdings Inc. this year, as well as the breaking prices of many non-fungible tokens, or NFTs.
All of these have benefited from popular enthusiasm that scorns the old order and has little to do with the kind of fundamental analysis that justifies more traditional investments.
Raoul Pal, co-founder of crypto investment platform Real Vision Group, said in a recent Twitter thread that this is part of a “seismic” shift driven by young people who are not looking for modest returns, but are rather willing to take huge risks to earn huge sums of money.
These new investors aren’t interested in your love of oil or raw materials or 50s V8s or your contemporary art from the 90s and 2000s. Your Jeff Koonz is just a stupid balloon sculpture. It is not their cultural reference. JPEGs are and memes.
It’s ALL a question of culture.
– Raoul Pal (@RaoulGMI) October 31, 2021
Others trace the speculative frenzy to the mountains of money that float around the global financial system as the Federal Reserve and other central banks keep monetary taps open to counter the effects of the Covid-19 pandemic. But these easy money policies have an eventual expiration date.
âThere is just a lot of money to find the best theme. Beast or not! The ‘hot money ball’ effect, âsaid Jonathan Cheesman, head of over-the-counter and institutional trading at the FTX crypto derivatives exchange.
One consequence is that crypto projects that have invested a lot of time and energy on the part of knowledgeable people who wish to apply technology to create utility – whether in financial tools like with DeFi, or rights of ownership as with NFTs, or a myriad of other potential domains – find themselves outclassed by tokens that were apparently created with almost no effort at all.
âIt is somewhat insulting to see a coin like #SHIB have a higher market cap than other projects like #Algorand, #Avalanche #Polygon #Stellar (to name a few) or years of R&D, innovation and doctoral talent and time has been devoted to advancing this space, âsaid Arslanian of PwC.
Crypto has delivered wild rides, not just memecoins. This reality can be easily overlooked with Bitcoin and Ether both trading near historic highs. Bitcoin, for example, fell over 80% between December 2017 and December 2018. And you don’t have to go back that far to find an example – just look at Dogecoin earlier this year.
âOn April 13 it was priced at 7 cents; 25 days later, it peaked at 74 cents and made it into the top 10 for crypto before dropping nearly 80% over the next six weeks, âNexo’s Trenchev said. âThis is how quickly the crypto market can turn against you. ”
The history of investing is littered with examples of booms and recessions. The verdict on this current craze has yet to be determined, but the people who pile up now risk learning a hard lesson somewhere down the line. Squid Game investors have done this before.