Last October, a rug pull devastated investors eager to make money from cryptocurrency token “SQUID,” named after the popular Netflix show Squid Game.
With its bandwagon hype, the token’s value skyrocketed by a whopping 23,000,000% to $2,862 within a week. It took less than five minutes though before the value rapidly plummeted to $0.0007926 as the developers embezzle almost $3.4 million from their investors.
The SQUID scam is now a cautionary tale for many crypto enthusiasts as rug pulls of the same kind are becoming greater in number.
What’s A Rug Pull?
A “rug pull” refers to a cryptocurrency scam in which developers abandon a project and run away with investor money.
Initially, developers will launch a project which looks legitimate and has a lot of potential – from social media presence, advertisement, and documents. Once they’ve gained the trust of investors and the general project, they will pool the investment fund, banking on bandwagon hype. The next thing you know, they go incommunicado and abandon the project. Goodbye, money.
Related Reading | Propelled By Rug Pulls, Crypto Scams Rise 81% In 2021
Below, we listed five ways you can spot a rug pull and save yourself from losing your hard-earned moolah.
1. Check The Profile Of Developers
First and foremost, potential crypto investors must check on the credibility of the people behind the projects.
Do the developers have a track record in the crypto community? Is…
