The Squid Game series on Netflix rocked the world, and so did its cryptocurrency. Gamer fans created a computer game version of the series that requires Squid cryptocurrency. The currency was priced at one cent when it launched. It is now at $4.39 per coin.
The question that lingers in the mind of investors now is simple: will this cryptocurrency be here to stay? The short answer is no. It is a fad, and once the excitement of the Squid Game series fades away, so will the interest in the computer game.
And if these two things happen, there is no reason for the gamers to keep buying and pumping the Squid Cryptocurrency.
The problem with this cryptocurrency is that the investor, or the buyer, cannot resell his tokens. What this means is that it is nothing more than an in-game currency. Its only purpose is to use it in the game.
It is this problem where the creators of Squid get criticisms. The buyers have no other option but to use the tokens to play the game.
Now, the Squid currency is not a typical in-game currency. The way the computer game was designed was simple. You have to play to earn more tokens. You can swap the tokens for other cryptocurrencies or with real money, as in fiat.
The online program begins in November of 2021. After people in the game, they will compete with others. The winner takes 90% of the prize pool. The prize pool comes from the entry fee, which is the token paid for by the payers.
The creators of the game jokingly said that no player has to really die. When players join, they have to pay for each round. For example, the Red Light, Green Light round costs 456 Squid. It has six rounds, and players could expect the games to get more expensive as they progress.
The website CoinMarketCap issued a warning that the token buyers cannot resell their tokens to other players. Right now, the market capitalization of the game is at $184.
A trader told the BBC via Twitter that they have $7,500 invested in the currency. They said that they were hoping the currency would get released in 48 hours.
The company that made the token said they had no clarity on how it happened. They said that their systems use innovative technology that prevents dumping. It prevents people from selling the coins. The news agency BBC sought out more information, but the company has not yet responded.
An economist at Cornell University said that the Squid is a kind of cryptocurrency piggybacking on the success of random memes. Random memes are also called cultural phenomena.
Many such coins make investors prey. The investors fancy that they can make a lot of money with it. As such, the coin keeps on inflating because of wild speculations and valuations. The result is that naïve investors would eventually suffer substantial losses.
Is Play-to-Earn the Future of Games?
Apparently, it is the future of games. Take note that it is similar to gambling, like if you go to online casino Japan sites. These games are popular during the pandemic because people are looking for ways to earn extra cash.
There is certainly a movement where earning money by playing is the next step in the gaming sector. GameFi technology is widely available as it allows game producers to combine entertainment with the tools to make earning money possible.
Is the Squid Currency a Scam?
Some say that it is, and it very may well be. The people who bought the Squid currency at one cent are at the top of the earnings food chain. They bought the token for less than what it is valued today. Those who bought at $4.86 are certainly at the losing end of this bargain.
If one purchases 500 tokens at $4.86 each, the total cost is $2,430. If another player bought 500 tokens at one cent, his total cost is $5.
If the player who spent $2,430 won and now has 90% of 1,000 tokens, he has a total of 900 tokens. The problem is, how much can he swap these tokens for? Is one token worth one cent or $4.86?
Therein lies the problem. Since the person who spent $2,430 cannot resell the tokens, his only options are to encash the tokens in the Squid Universe.
What the creators of the game should have done was veer away from cryptocurrency. Instead, they should have centralized the entire process. For example, the tokens in circulation must only be equal to the revenue they earned, and that the price does not fluctuate.
It is easier that way. For example, charge $1 for one token and have 500 players in the game from start to end. The last player standing will get 450 tokens, and the remaining 50 tokens will go back to the system. The winner now swaps 450 tokens to $450, and the losers will have to buy new tokens if they want to play again.
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