Logan Paul’s Cryptozoo Scam: Unraveling the Controversy
Written by John Hohenshilt
The highly anticipated influencer boxing event scheduled for October 14th, featuring the much-anticipated showdown between KSI and Tommy Fury, along with Logan Paul’s bout against Dillion Danis in the undercard, has once again thrust Logan Paul’s Cryptozoo Scam into the spotlight, illuminating its controversial nature.
In this article, we will delve into the intricate details of Logan Paul’s Cryptozoo fraud, shedding light on the events that transpired, the repercussions that followed, and the valuable lessons to be gleaned. This comprehensive article will be divided into four sections, covering the project’s inception, its unraveling, its downfall, and the key takeaways from the ill-fated Cryptozoo venture.
I. The Inception of Cryptozoo
In 2021, Logan Paul, renowned for his high-profile YouTube channel and online persona, made his foray into the cryptocurrency realm. It was during this time that he unveiled Cryptozoo, a groundbreaking blockchain-based project that sought to intertwine the allure of cryptocurrency with the excitement of virtual animal ownership. The core elements of this project comprised the zoo token, complemented by purchasable eggs that would eventually hatch into creatures capable of generating additional tokens. With a mantra that emphasized, “Cryptozoo is a fun game that makes you money,” Logan Paul’s marketing approach was nothing short of audacious since the project was being heavily market even though it was not complete.
A. The Promise
Logan Paul presented Cryptozoo as a groundbreaking and potentially lucrative investment venture. He asserted that investors had the opportunity to acquire and trade virtual animals in the form of NFTs (non-fungible tokens), capitalizing on their growing scarcity and escalating value. Additionally, participants could engage in breeding these virtual creatures, thus creating their very own digital menagerie comprised of NFT animals.
B. The Team
Like any substantial project, a diverse group of individuals played pivotal roles in this endeavor. Regrettably, several team members possessed checkered pasts riddled with deceit and alleged fraudulent activities. Beyond Logan Paul and his manager, Jeff Levin, the team comprised Eddie Ibanez and Jake Greenbaun, who goes by the moniker “The Crypto King.”
Eddie Ibanez, in particular, has a history of untruths, having falsely claimed to hold a degree from MIT (the Massachusetts Institute of Technology), asserted involvement in the Philadelphia Eagles’ Super Bowl victory, and even contradicted his own orphan status, as confirmed by his wife during a live TV appearance.
On the other hand, Jake, previously known as “Collectables Guru,” gained notoriety for his questionable conduct, including allegations of selling counterfeit Pokémon cards.
C. The Launch Failure
Upon the launch of the zoo token, it became evident that the situation had taken a dire turn. The token’s value plummeted almost instantly, resulting in a complete loss for investors and enthusiasts who had put their money into it. Furthermore, the eggs that people had acquired turned out to be nonviable, rendering the token’s primary purpose futile.
Meanwhile, Eddie Ibanez and Jake “The Crypto King,” wasted no time in selling off the majority, if not all, of their tokens. This swift disposition was made possible by the presence of loopholes and flawed project designs, exacerbating the project’s woes. Logan and his manager did not sell their tokens which are worth noting.
II. The Unraveling of Cryptozoo
A. Red Flags
In addition to the concerning composition of the project team, several glaring red flags hinted at the impending failure of the venture.
Firstly, Logan Paul’s limited experience in the cryptocurrency realm raised questions about his ability to navigate such a complex undertaking. His prior involvement in the Dink Doink crypto project, characterized as a “pump and dump” fraud, did little to instill confidence. Jake the Crypto King, one of Paul’s own team members, candidly stated, “Logan was not smart enough for what he tried to build,” underscoring the skepticism even within the project’s ranks.
A second troubling aspect revolved around the design of the virtual animals. Despite Logan Paul’s claims of commissioning unique artwork for these creatures, it came to light that the images were generic stock photos readily available on the internet. This revelation was brought to the forefront by prominent YouTubers like Coffeezilla, who exposed this deception through their videos.
A third critical concern pertained to the compensation of the project’s developers. Logan Paul, lacking coding expertise, outsourced the development work to external parties. Unfortunately, due to poorly structured contracts, many of these developers encountered difficulties in receiving their rightful payments. The situation reached a breaking point when one coder held the project’s code hostage, demanding one million dollars in unpaid fees. On the day of the project’s launch, when the eggs failed to hatch as intended, Logan Paul attempted to shift blame onto the coders, despite being fully aware of the code’s deficiencies caused by payment disputes.
B. Emerging Concerns
As the token’s value began to plummet and the eggs failed to function as intended on the day of the launch, a wave of unease swept through the Cryptozoo community. Investors started voicing their doubts regarding the project’s legitimacy, with a significant share of these apprehensions directed towards Logan Paul and his manager, Jake. In response, Logan and Jake consistently downplayed these concerns, assuring stakeholders that they were diligently working to rectify the issues. This assurance persisted for several months, but eventually, the project team ceased responding to the anxieties of their investors.
A glimmer of hope was briefly ignited during an episode of Logan Paul’s podcast, where he hinted at ongoing efforts related to a project. It was widely assumed that this project was Cryptozoo, instilling optimism among investors. However, to the surprise of many, Logan was referring to an entirely different venture called “Logan Paul’s 99 Originals,” an NFT project that enjoyed a reputation untarnished by any fraudulent activities and was, in fact, held in high regard within the crypto community.
III. The Fallout
A. Logan Paul’s Silence
As previously mentioned, Logan Paul and his team entered a period of silence while shifting their focus toward new projects. However, in 2022, the YouTuber Coffeezilla, known for his previous exposés on Logan Paul’s involvement with Dink Doink and the use of generic animal images, released a comprehensive, multi-part video series that thrust the failed Cryptozoo project back into the spotlight.
This exposure garnered much-needed attention and stirred a significant uproar within the community. As the controversy intensified, the already shaky relationships within Logan’s team began to crumble, with each member attributing blame to others, as evident in various segments of Coffeezilla’s videos.
Primarily, Logan Paul bore the brunt of the backlash, as his public persona continuously highlighted his successful business venture, “Prime Hydration,” his involvement in the WWE, and his revenue-generating fights.
B. Unearthed Evidence
The multi-part series by Coffeezilla brought to light a wealth of information, painting a troubling picture of Logan Paul and his team’s relentless pursuit of profit, often at the expense of the project and its investors. As the investigation unfolded, several significant revelations emerged.
Foremost among these discoveries was the unsettling truth about the unpaid programmers involved in the project. Additionally, wallets linked to Eddie and Jake the Crypto King revealed a concerning pattern of selling their tokens immediately. While Logan Paul’s financial gains remained less evident, Jake was estimated to have profited approximately 1.8 million, and Eddie, under 6 million, from the token sales. These revelations exposed the fragile nature of the team’s unity, showcasing instances of internal discord and betrayal.
Further compounding these concerns were leaked text messages that underscored the team’s primary focus on profits. These messages also unveiled the team’s exploitation of a regulatory loophole for an unrestricted presale. To clarify, their intention was to conduct a presale allowing them to acquire tokens at a discounted rate. However, this approach would have subjected the project to regulatory scrutiny by the SEC (U.S. Securities and Exchange Commission) due to its questionable nature. To circumvent this, the team executed a somewhat clandestine presale, launching the token without prior announcement and buying up tokens. On the day of the official launch, they introduced a different version of the token, offering the original token holders an equivalent amount in the new Zoo token. Additionally, these text messages, confirmed by Jake during an interview with Coffeezilla, revealed that the team had been verbally instructed not to engage in token sales that could disrupt the market. Lacking protective coding measures to enforce this, it was unsurprising that Eddie and Jake swiftly sold their tokens, contributing to the token’s c.
C. Logan’s Response
In the wake of Coffeezilla’s damning exposé and the torrent of criticism directed at him, Logan Paul’s response took two distinct paths.
Initially, Logan attempted to undermine Coffeezilla’s credibility and intentions while neglecting to refute any of the claims or evidence presented in the videos. He resorted to questioning Coffeezilla’s motives and credibility but failed to address the substantial evidence. Furthermore, Logan falsely claimed that Coffeezilla had not reached out to him directly, only contacting his manager, despite Coffeezilla providing DMs (direct messages) that clearly demonstrated attempts to engage with Logan.
However, this initial response garnered a highly unfavorable reception from the online community, leading Logan to adopt a different approach. In a second response, Logan extended apologies to both investors and Coffeezilla, expressing his commitment to make amends with investors and maintain his innocence in the project while shifting blame elsewhere. Despite this, investors remain unpaid, perpetuating the project’s history of unfulfilled promises.
Throughout these responses, Logan Paul continued to tout his successes, particularly in his venture “Prime,” which further fueled skepticism regarding his sincerity and commitment to rectifying the situation.
IV. Lessons Learned
A. Due Diligence
The Cryptozoo controversy serves as a reminder of the importance of thorough due diligence before investing in any cryptocurrency project. Investors must carefully research the team, technology, and whitepaper to assess the project’s legitimacy.
B. Celebrity Endorsements
Celebrity endorsements should not be a sole basis for investment decisions. It’s crucial to evaluate the project independently, regardless of the influencer’s reputation.
C. Regulatory Scrutiny
The Cryptozoo case also highlights the need for stricter regulation in the cryptocurrency space to protect investors from scams and fraudulent schemes.
Conclusion
Logan Paul’s Cryptozoo scam serves as a cautionary tale for both seasoned and novice cryptocurrency investors. While the allure of quick profits can be enticing, it’s essential to exercise caution, conduct thorough research, and rely on verified information rather than celebrity endorsements. The Cryptozoo controversy underscores the ongoing challenges of ensuring transparency and trust in the evolving world of cryptocurrencies.
Sources
· The Coffeezilla YouTube video series
o (132) Investigating Logan Paul’s Biggest Scam — YouTube
o (132) The Biggest Fraud in Logan Paul’s Scam — YouTube
o (132) Ending Logan Paul’s Biggest Scam — YouTube
o (132) Logan Paul Apologized To Me — YouTube
o (132) Logan Paul’s Scam Isn’t Over — YouTube
Disclaimer: The author of this article is not a licensed finance professional. This article is meant for educational purposes only. Crypto and investing are risky. Remember to do your own research.
