Other than a lawsuit concerning a crypto-zoo, the famous social media influencer Logan Paul has been met with new allegations of misleading fans about crypto investments. A BBC investigation uncovered alleged links between Logan Paul and private crypto wallet trades.
The influence of Logan Paul can be explained best by his 23 million subscriptions on YouTube. BBC has shown that he caused prices in these investments to spike, leading to hints he could have profited from sales of any tokens he held.
The accusations link Logan Paul to questionable crypto trades and ethical concerns and center on his approvals of high-risk tokens like Elongate and Dink Doink and his failed non-fungible token (NFT) project, CryptoZoo. Logan Paul is currently facing a multi-million-dollar lawsuit over the failed project. Reports say that he denied all wrongdoing.
Logan Paul linked to shady crypto investments – The BBC Investigative report
Logan Paul is reported to have begun mentioning crypto three years ago. He is reported to have influenced an Elon Musk-themed meme coin known as Elongate. He said in a video clip, “Elongate made me rich. Elon baby, let’s go!” on his subscription-only fan club, which was later reposted on X.
Following this, the price of Elongate rose by over 6,000% to an all-time high. BBC claims that it seemed like his mention of Elongate affected its price. An unknown wallet purchased almost $160,000 worth of the token about an hour before Paul’s post.
The post prompted many buyers, spiking the price. Twelve hours later, the wallet sold most of its holdings. The total profit made from this trade appears to be just over $120,000.
In June 2021, Logan Paul also promoted a meme coin called “Dink Doink.” Paul promoted the token on X, saying, “I think it’s going to go crazy.” An X user raised a complaint and asked that Paul be investigated.
Again, this led to many buyers, causing Dink Doink’s value to spike. Soon after large-scale holders of the token began selling, the price fell by 96% in just two weeks.
Time Magazine analyzed another anonymous wallet that had bought Dink Doink before Logan Paul promoted the coin and then sold its holding shortly after. This wallet later sent $100,000 to Paul’s public wallet.
The anonymous crypto wallet analyzed by the BBC appears to have close connections to Paul. The BBC claimed that they could see that the wallet first received funds in February 2021 from a public wallet owned by Logan Paul and then started buying and trading crypto.
The Crypto Zoo lawsuit
In his current lawsuit, the lawyer behind the claim said the failure to deliver the game forms only one part of the case. He said the other part is the leaked messages. He explained that the messages reveal that Paul and his team were involved in a “stealth launch” of the Zoo Tokens. This allowed them to quietly buy in at a low price.
Logan has repeatedly denied any wrongdoing related to CryptoZoo. He chose to blame other team members, whom he says failed to deliver the promised features.
Earlier this year, Paul announced a partial compensation scheme for disappointed investors. He promised to refund people who had bought the NFT eggs, but only if they agreed not to sue him for anything relating to CryptoZoo.
Whose side is the SEC likely to be on concerning these allegations?
According to Gary Gensler, the head of the Securities and Exchange Commission (SEC), if a celebrity promotes a particular crypto token, they are supposed to indicate if they get paid and how much they get paid.
He further explained that details should be given about whether they own the tokens, made money on the tokens, or actually know something about the project.
In the past, several celebrities have run into legal trouble for promoting crypto. One of them is Kim Kardashian, who was fined $1.26m in 2022 for promoting a token called EthereumMax on her Instagram account.
Logan Paul has several sagas of crypto lawlessness. SEC is known to deal roughly even with big crypto investors. Will this be different?
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Source: https://www.cryptopolitan.com/logan-paul-misleading-crypto-investors-bbc/