Influencers Logan, Jake Paul under increasing scrutiny for cryptocurrency dealings
It's official: Sam Bankman-Fried, once the boy-wonder of the crypto world, has been extradited to the U.S., where he will face fraud charges over the collapse of FTX, the cryptocurrency exchange he oversaw.
A proponent of "effective altruism," Bankman-Fried, once worth $16 billion, finds himself charged with eight crimes, including money laundering and wire fraud. One of the Biden campaign's top donors, the 30-year-old faces up to 155 years in prison for allegedly swindling investors.
Bankman-Fried, however, isn't the only influential cryptocurrency figure accused of committing various crypto-related sins. There are also Logan and Jake Paul, two brothers with a significant social media presence.
Logan, 27, the elder of the two, has a YouTube channel with almost five million subscribers. On Instagram, he has 24.6 million followers. Meanwhile, Jake, 25, has 21.5 million followers and a very popular YouTube channel of his own. When it comes to influencers and genuine influence, the brothers are two of the biggest names in the business. Both find themselves accused in civil court pleadings of knowingly participating in numerous cryptocurrency scams and misleading potential investors.
Today, there are more than 20,000 different cryptocurrencies in existence, the vast majority of which some experts deem absolutely worthless. The two biggest cryptocurrencies are Bitcoin and Ethereum. The former, the first-ever cryptocurrency created, arrived in 2009; it is the largest cryptocurrency by market cap. Witnessing the explosion of Bitcoin and, to a lesser extent, Ethereum, some decided to create questionable coins of their own and market them to the masses.
Over the past few years, YouTube investigative muckraker Coffezilla, real name Stephen Findeisen, has played a key role in highlighting a range of alleged crypto-related scams. He was one of the first to expose Bankman-Fried's alleged misdeeds and question his motives. He was also one of the first to sound the alarm on the aforementioned Paul brothers.
Earlier this year, as Findeisen previously noted on his own YouTube channel, Jake Paul was threatened with legal action over his promotion of Safemoon, a cryptocurrency critics say has no real-world utility. Since Safemoon's creation in March of 2021, investors have "lost hundreds of millions of dollars," as Bloomberg Law first reported. Moreover, according to reports, the crypto's parent company, SafeMoon LLC, allegedly failed to register the tokens as securities with the U.S. Securities and Exchange Commission.
In February, Paul and a host of other notable celebrities, including the singer Nick Carter and the rapper Lil Yachty, were sued for their participation in the project. Jake Paul was, up until very recently, one of Safemoon's leading spokespeople. The media personality and professional boxer has participated, Findeisen alleges, in at least five different scams, raking in millions of dollars in the process.
Jake's brother Logan, meanwhile, is also heavily involved in the crypto space. In June of 2021, the world was introduced to Dink Doink, a cryptocurrency he openly promoted that is currently worth absolutely nothing.
Shortly after Dink Doink appeared and Logan Paul began promoting it, InvestorPlace's William White wrote a scathing critique of the crypto. Dink Doink, he noted, is good for "absolutely nothing." Paul, he alleged, appeared to be participating in a classic pump and dump scheme, in which an individual or individuals spread misleading information in the hope of creating a buying frenzy that artificially "pumps" up the price of the asset.
One tweet, sent out on June 29, 2021 of last year by Paul to his 6.7 million Twitter followers, resulted in Dink Doink's value rocketing by 40,000%. Soon after the astronomical rise, it crashed in value.
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