A relatively unknown cryptocurrency called Omicron (OMIC), which coincidently shares its name with the new Covid-19 variant, has spiked more than 900 per cent over the last 48 hours. Omicron's OMIC token hit an all-time high of $689 on Monday morning, once again reminding us how weird crypto market and trading can be. The token was selling at just over $50 on Saturday but has now risen to $631.04, as per CoinGecko (at the time of writing).
The token shares its name with a new Covid-19 variant that was first discovered in South Africa on November 23. The World Health Organization named the fast-spreading B.1.1.529 strain after the fifteenth letter of the Greek alphabet. Interestingly, most cryptocurrencies have been hit with the emergence of this new Covid-19 variant. Both Bitcoin and Ethereum are in the red, while others have seen similar trends as well.
Investors need to be really careful before trading in Omicron though. There is limited information and data available about this coin despite its sudden surge. In fact, neither CoinGecko nor the Crypto.com bitcoin and crypto exchange have enough data to even provide it with a market captilisation.
The token is described as "a decentralized treasury-backed currency protocol". Moreover, the token built on ethereum scaling technology Arbitrum, can be only be traded on the controversial decentralised exchange SushiSwap. These types of exchanges are not regulated by a central authority in charge. They are often prone to hacks, exploits and so-called rug pulls where investors end up losing a lot of money.
A very recent example of this is the Squid Game token. Most of you must have heard about the popular Netflix series - Squid Game. A crypto token was named after it and launched a few days after the show became a global hit. It was bought and sold online, giving nearly 3000 per cent returns in three days. The token had a legitimate website and social media handles but nobody bothered to check the people behind it.
The crypto token crashed to zero after the token developers did the rug pull. This is the kind of scam where token creators leave the market along with the investors' money. The website and social media handles of crypto were non-functional within hours. Investors lost more than Rs 25 crore. All of their money turned zero in less than five minutes.
We are not implying that this may happen with Omicron too but investors should definitely be watchful in the current environment when there is so much uncertainty around crypto investments.
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