Analyzing the “Squid Game” Flash Crash Event: The Mystery of SQUID’s Circulation

After the Squid Game flash crash event, this token was reborn in another way.

On November 1, the developer of the project was suspected of selling 70 million Tokens and then ran away, making a profit of US$11.9 million. This caused the price of SQUID to fall from US$2,856 to US$0.00079 within a few seconds. Rhythm’s follow-up reported that Binance is investigating SQUID and adding the relevant addresses of the project parties to the “blacklist”.

However, the development since then is staggering. Because the project party “ran off”, the project was taken over by the community and transformed from GameFi to Meme currency. Many investors in the project shared spontaneously, which also caused SQUID to bottom out and become a hot project for a while. Calculated with the lowest touch of 0.00079, the current price of about $0.4 has risen hundreds of times from the bottom.

Under the propaganda of community members, this project seems to have become a completely decentralized Meme token with no project parties, no dealers, and community autonomy. However, checking the data on the chain does not seem to be sufficient for this view.

Binance blocked the project party?

It is worth noting that although Binance announced that the relevant address of the project party will be included in the “blacklist”, the specific interpretation of the “blocking” measure is “identify the address belonging to the project developer; deploy blockchain analysis To identify the wrongdoer; report the findings to the judicial department of the jurisdiction.”

As of today, Binance’s official website has not issued an official announcement indicating the addresses of the projects that have been “hacked”, and it has never clearly stated that the currency holdings of these addresses have been locked. Measures such as “coin lock” and “freezing” as rumored by the community are difficult to verify from the data on the chain.

Ordinary users are still unable to determine whether the project party holds a large number of tokens, and the risk of “return to zero” caused by the project party’s smashing of the market still exists after the “return to zero” has been performed once.

The mystery of SQUID circulation

BscScan data shows that the total supply of SQUID tokens is 800 million.

In the widely circulated discussion in the community, there are rumors that due to “locking coins”, “destroying” and other reasons, the circulation of SQUID is currently only tens of millions. The data on the chain does not seem to support this assertion.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

The smart contract “SQUID Roken Rug 2” deployed by Squid Games currently holds about 40 million SQUIDs, which accounts for about 5% of the total supply. In addition, the currency has designed a transaction destruction mechanism. Burn Address has destroyed about 37.84 million US dollars of SQUID, accounting for about 4.7% of the total supply. Regardless of the “binance lock coin” online transmission, more than 90% (over 720 million) of SQUID are still in circulation.

In addition, SQUID holdings are highly centralized. BscScan data shows that the total number of holding addresses exceeds 180,000 addresses. Even if the burn address (Burn Address) and the project contract (SQUID Token Rug 2) are excluded, the top 5 addresses still occupy the holdings. About 30% of the total supply.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

“0x4b” is the largest holding address, holding up to 136 million SQUID tokens, accounting for about 17% of the total supply. Data on the chain shows that this address has never actively initiated a transfer since its creation, nor has it sold SQUID, and only passively receives tokens. However, this does not rule out the possibility of the address selling SQUID. If calculated at the current price, the value of the SQUID held by the address is about 60 million U.S. dollars.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

(On the comment page of this address in BscScan, many coin holders have persuaded the big owner not to sell SQUID)

And what about the positions of other big players? “0x77” holding 65 million SQUID was still initiating transactions on November 7, and “0x8F” holding 19.94 million SQUID was still transferring out of WBNB on November 8. We have found signs of activity in the addresses of many large coin holders. The rumored situation that “there are only tens of millions of coins in circulation” cannot be established.

According to Pancakeswap data, the current liquidity pool of the most liquid SQUID/WBNB trading pair is only about $4.23 million. The pool includes 5.24 million SQUID and 3260 WBNB. This depth of liquidity is also difficult to cope with the impact of large-scale SQUID selling.

How much money did the hunters make?

Take the fifth largest currency holding address “0x8f” as an example. This address now holds 19.94 million SQUID, which is worth about $8.77 million at current prices, which is even higher than the depth of the SQUID/WBNB liquidity pool. And this surprisingly huge position is even just the amount after the address is reduced.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

BscScan shows that since November 1st, this address has continued to purchase SQUID. The first transaction purchased about 4.96 million SQUIDs at 0.1 BTC B, and then dozens of transfers continued to use BTCB for purchases. The amount of each transaction is 0.1, 0.15 or 0.2 BTCB, and about 6 BTCB have been spent in one day.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

(In stark contrast to the surge in SQUID balance, the BTCB balance of this address dropped rapidly)

While buying this address, it is also increasing the liquidity of SQUID. With only SQUID/WBNB liquidity, approximately 19.6 million SQUID and 250 WBNB were added in two installments.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

In addition to SQUID/WBNB, the address also adds a liquidity pool for several other mainstream coins such as SQUID and BTCB.

A few days later, the enthusiasm for buying the bottom and zero coin broke out, and the price of SQUID has also walked out of the bottom. The address began to sell off. On November 5, the address withdrew its liquidity for the first time, withdrawing 17 million SQUID.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

Since then, the address began a long sell-off process. Take the following picture as an example. This address sells about 100,000 SQUIDs at a time and exchanges them for BTCB. This process continued in the following days.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

Starting from November 6th, this address has continuously sold SQUID in 13 transactions, earning a total of 13 BTCB.

Analyzing the "Squid Game" Flash Crash Event: The Mystery of SQUID's Circulation

With 6 BTCBs invested, 13 BTCBs have been obtained in just a few days, in addition to 19.94 million SQUIDs (worth approximately US$8.8 million). If calculated at the current price, the return rate of this operation has been approximately 25 times. However, this huge floating profit is still difficult to realize. The SQUID of US$8.8 million is higher than the depth of the liquidity pool. To successfully cash out and exit, more retail investors need to enter the market to inject liquidity.

Although we have no way of knowing the true identity of “0x8f”, there is no doubt that this address is still active, which also shows that we cannot rule out the possibility of its future selling. 19.94 million SQUIDs are always a dark cloud haunting SQUID investors. 

Posted by:CoinYuppie,Reprinted with attribution to:
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