Binance to investigate Squid token rug pull

Following the recent Squid coin debacle investigators from crypto exchange Binance are determined to establish what happened.

The crypto token inspired by the popular Netflix series Squid Games turned out to be a fraud, or “rug pull” scheme, whereby investors are invited to back a token, but the money is then syphoned off without a trace.

In an email to Business Insider, investigators from the exchange confirmed that the company had launched an investigation into the matter.

The Squid rug pull even got Binance CEO Changpeng Zhao to reflecting on the matter and the proliferation of fraudulent activity in DeFi space.

“I’d like to take this opportunity to remind users that DeFi is not without its risks, and we hate to see anyone lose their funds due to scams and other cybercrimes”, Zhao wrote.

Squid was first coin introduced on PancakeSwap and DODO and was listed as a Binance Smart Chain token.

BSC is a private blockchain developed by Binance. Squid reached a total valuation of $2,856 before it was shut down with the money gone from the platforms.

While the currency was advertised as a play-to-earn solution, meaning that stakeholders could earn the more they held, investors began to question the project which apparently made the people behind the project skittish.

A critical objection was raised when the tokens bought were locked and not open to trade or sell. One notable mistake was the misspelling of Elon Musk’s name, which immediately sent red flags to critical observers.

However, now that Binance is on the job, there is a chance of recovering funds. Binance has experience working with law enforcement and has been able to recover numerous stolen funds. In one instance, Binance exposed a criminal group that was estimated to have  gathered $500m.

While Binance has found itself in a tough situation with a few regulators around the world, the exchange has been able to conduct business as usual, actively trying to counteract hacking attacks.

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Source

Updated: 11/05/2021 — 12:00