Anonymous Wallets and Concealed Gains
Popular social media influencer Logan Paul faces charges of secretly advertising cryptocurrencies. An investigation by the BBC has connected Paul to an anonymous wallet allegedly used to purchase and sell crypto tokens that he had promoted to his millions-strong online following. According to the report, the wallet bought tokens in advance of Paul’s promotions, later selling them for enormous gains following the resultant price spikes.
This has raised questions about ethical practices in influencer marketing, particularly in the volatile crypto space. Critics argue that undisclosed financial interests could mislead followers into making risky investments.
Elongate Profits Questioned
One of these concerns the memecoin Elongate, which Paul has promoted. The anonymous wallet reportedly purchased $160,000 of the Elongate tokens before he promoted the cryptocurrency publicly. After his promotion, the wallet is said to have sold its stake and netted an estimated profit of $120,000. Such behind-the-scenes deals, if confirmed, could already constitute a breach of advertising and financial disclosure laws.
The allegations underscore growing concerns about influencers’ roles in promoting high-risk investments without transparency. With younger audiences increasingly engaging in cryptocurrency trading, such actions could lead to significant financial losses for followers.
BBC Interview Stunt
The BBC’s attempts to confront Logan Paul about these allegations took a peculiar turn: “Reporters traveled to Paul’s gym in Puerto Rico, only to be greeted by a lookalike – and the reporters alleged that Paul orchestrated the staged event to mock their inquiry.”.
This bizarre incident was complete with a group of people holding banners, chanting allegations at the BBC team. The reporters reported there were several cameras ready to capture the incident, saying it was all a set-up, an attempt to troll.
The CryptoZoo Scandal
Adding to the drama comes Paul’s NFT project CryptoZoo, which is steeped in controversy. An online game initially promised to enable users to collect money by breeding animals digitally, CryptoZoo has allegedly been plagued by investor lawsuits. Plaintiffs have alleged that the project is full of failed promises, causing over $4 million in collective losses.
In response, Paul unveiled a “buy back” program last January 2024, which promised to buy back the NFTs from investors at the purchase price. However, to avail of the offer, participants had to give up their right to sue – a proviso seen by many critics as an attempt to escape liability.
These allegations, as the scrutiny tightens, may have some lingering effects on Paul’s reputation and the greater conversation of ethics in influencer marketing.
