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Last week, the Squid project, based on the Netflix TV series of the same name, gained popularity among cryptocurrency investors. Developers of the project promise to launch an online tournament in November, similar to games in the series, with six rounds.

Presumably, payment in SQUID tokens will be required to participate in the competition. After the project is completed, the funds will be divided between developers and winners in proportions of 10% and 90%.

Despite reports that the Squid Game project was proven to be a fraud and Binance launched an investigation into its creator, the price of the SQUID token started to rise again. The price on Nov. 8 was around $0.38 (up from a low of $0.008).

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there are several reasons

• The SQUID token is a fraudulent project, so it is unbelievable that many people lost their money. The project is popular with crypto investors for several reasons:

• The "hype" surrounding the "Squid Game" series, which is what the project's creators use;

• Retail investors still think of cryptocurrencies as a tool to generate money out of thin air. That is, they do not in any way delve into the technical characteristics, scope of application and intrinsic value of the token, and it is precisely due to these factors that the rate of currency appreciation is constantly increasing;

The effect of meme cryptocurrencies like Dogecoin and Shiba Inu, whose rates can fluctuate up and down within hours, yields huge profits to holders.

Most likely, the growth of the SQUID token is not organic. Project creators can use the "Pump & Dump" scheme to artificially inflate the value of tokens. False market players rigged the whole process; this superimposed the excitement of the entire series and produced such a stunning effect.

Investors see the exchange rate rise and rush to invest in a new currency, hoping to make a quick profit.

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The crypto market is built on reputation

Before investing in any cryptocurrency project, one needs to research it and carefully assess the market outlook. Even if the founders of the project don't want to deceive anyone, but plan to create a useful product, it often fails to survive in the crypto market.

In the case of SQUID, the investor did not check the project team at all. Who started it, who created it? The project's website doesn't work, neither does the social network, and Netflix has disavowed the project. The crypto market is built on reputation, and the SQUID team doesn't have any reputation.

SquidGame's story started out suspiciously. Information about the creator of the project does not exist from the start. One should be wary of projects that become very popular in the crypto market after a few days.

Some typical scams:

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airdrop scam

Currently, there are many such companies. Users are required to send any amount of tokens to an address for verification. Users will then instantly receive 10x the amount of tokens they sent.

These scams try to appear legitimate by mimicking the Medium platform. They use countdown timers to induce FOMO, and even fake "live" updated trading tables.

Buttons on the page don't work. For example, the clapping hands and social media icons in the image below don't work at all.

Airdrops are real in this industry, and cryptocurrencies are known for 10x and 1000x people's investments. It has happened and it will happen again.

So when newbies, or people in desperate need of money, see these kinds of opportunities, they're hooked. Because it seems reasonable.

customer support scam

As an investor, it is imperative to understand what the different projects are about. This also means joining Telegram groups or other communication channels.

Unfortunately, scammers are also part of these groups, as anyone can join.

You may have questions about the project or encounter some technical difficulties.

Then, a scammer posing as an admin contacts you directly in a message outside the group.

Then you'll get help with any issues you may have. Next, a solution is provided that always includes sensitive information. Most likely the wallet recovery phrase.

Scammers claim there is a connection problem between the platform and your wallet. To fix this you need to sync and import your wallet again. You will then receive a link that will take you to a website like the one below.

Never write or send your recovery phrase to anyone!

rug pulling scam

The SquidGame above is a typical rug-pulling scam.

The creator of the token sold all the liquidity, causing the value of the token to drop to zero.

• The warning signs are there:

• The tokens themselves can only be bought, not sold...attention!

• In addition to the creators, comments on their social media accounts are also disabled.

• This site is very unprofessional and the creator chose to remain anonymous.

Source：https://medium.com/coinmonks/how-not-invest-in-dubious-projects-8863e7e72ffb

https://medium.com/coinmonks/how-to-avoid-current-crypto-scams-d68af9752f3a