The digital token, which was modeled after Netflix's South Korean series The Squid Game, lost almost all of its value when what appeared to be a scam was discovered.
Squid, a token that they advertised as a "cryptocurrency through which you can make money through the game", has grown significantly over the past few days and its price has increased 10 times.
However, many criticized the creators of this token because they do not allow investors to resell it, the BBC reported.
Cryptocurrency investors generally refer to this type of scam as "carpet pulling".
This occurs when a digital token promoter attracts buyers, then stops trading and walks away with the money he made from the sale.
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Those behind the Squid token have earned $3,38 million, according to data from tech site Gizmodo.
The "play to earn" system allows people to buy tokens that they use to play games online, and that way they can earn more tokens that they can later exchange for other cryptocurrencies or money.
The previous Tuesday, Squid could be bought for as little as one cent, and in less than a week the price had jumped to more than $2.856.
It has now fallen by 99,99 percent, according to the website KoinMarketKep, which collects data on cryptocurrencies.
The Squid token was being sold as a means of payment for a new online game inspired by the Netflix series about a group of people forced to play deadly games for money.
The game was expected to be released this month.
However, cryptocurrency experts have warned of several telltale signs that a scam could be taking place.
Most of the complaints came from people who bought Squid and claimed they couldn't sell that token.
Critics noted that the website of this cryptocurrency contains many grammatical errors and incorrectly written words.
The site is no longer functional, and the social media accounts that promoted this token have also disappeared.
"This is one of many schemes used by malicious cryptocurrency promoters to lure in naive investors," Eswar Prasad, an economist at Cornell University, told the BBC.
Buyers must be aware that there is almost no formal oversight when buying cryptocurrencies, Professor Prasad adds.
"In fact, open-ended schemes of quick buying and selling have taken off in the crypto world, and investors often jump into the story with their eyes wide open - probably hoping they can ride the wave, sell the cryptocurrencies they own and make a quick profit before the price drops." , he explains.
The squid could be bought on decentralized cryptocurrency markets like PenkejkSwap or Dodo, which allow buyers and sellers to connect directly, without centralized control.
"Today, new coins can be offered on decentralized platforms the same day they are created, without any conditions or additional verification," said Jinan Oujang of Singapore-based cryptocurrency firm Openmining.
"So you can buy cryptocurrencies from anyone with any plans," he adds.
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