In addition, could you provide a link to your YouTube channel so that others here can get a bit of a grip on the type of experience you create? I am sure it would help greatly with recommendations.
Just spitballing...
They probably cut out Squidward, placed him over an existing stock photo of some black and white curtains, over saturated the eyes, and then painted around them with a black fuzzy brush. All of this before turning down the saturation on the whole image even more to give it a washed out look.