Following the launch of Squid Game earlier this week, the new token has seen a 45,000% growth in a few days. However, several investors have reportedly had trouble selling the tokens.
There were multiple reports that users were unable to sell their tokens on PancakeSwap. In a warning about the SQUID token on its website, major crypto tracking website CoinMarketCap warned traders to exercise caution.
At the time of writing, the only market where SQUID can be traded is PancakeSwap, according to CMC.
The explosive growth of SQUID, coupled with reports that the token could not be sold, has led some crypto enthusiasts to believe that the new coin is a scam.
Crypto Tyrion noted that none of the Squid Game founders are members of LinkedIn, a major professional networking site. They also noted that the token was preventing comments on Twitter. According to Crypto Tyrion, "it's a total rug pull.".
Furthermore, observers cited grammatically incorrect claims and spelled-out errors in the Squid Game token's white paper, which Scamadviser rated as not trustworthy, with a trust score of 45 out of 100.
Squid Game token is an idea that is inspired by Netflix's eponymous show where players risk their lives playing deadly games in hopes of winning big. With the token, players can play six different online games for a chance to win prize money.
CMC noted in a post on Friday that the Squid Game described in the white paper may not be affordable for most participants due to SQUID's rally.
Accordingly, in order to participate in the sixth and final game, players would need to hold 15,000 SQUID, which, at the time of writing, would be over $80,000.
The white paper for the token says it implements an anti-dumping mechanism that will prevent investors from selling their coins in a similar way to major crypto assets like Bitcoin. In order to sell a certain number of SQUID, users must hold the so-called "Marbles" tokens, according to the white paper:
“On PancakeSwap, you can sell a certain amount of SQUID at any time if you hold some Marbles. You will automatically burn those marbles in your wallet after you sell some SQUID."
Squid Game can be played only by obtaining marbles without using violence, as stated in the white paper.
"SQUID liquidity will be locked for three years on DxSale, preventing any invisible and immediate changes to SQUID liquidity. The white paper also states that the unlock date is October 20th, 2024