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Zachxbt alleges Logan Paul is behind multiple crypto “pump and dump” schemes

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Zachxbt alleges Logan Paul is behind multiple crypto “pump and dump” schemes

People

Paul Logan allegedly hyped and dumped crypto projects like DinkDoink, EthereumMax and others.

2 min read

Updated: May 14, 2022 at 7:27 pm

Cover art/illustration via CryptoSlate

On-chain sleuth, Zachxbt, has struck again with a thread on Logan Paul and his alleged litany of shady dealings within the crypto space. 

In the thread, the pseudonymous detective revealed some of the possible scams Logan Paul has allegedly been involved in based on his transaction records.

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1/ A thread on @LoganPaul and his sketchy track record in the Web 3 space thus far. pic.twitter.com/wNmyw5TyFb

— ZachXBT (@zachxbt) May 13, 2022

He was able to do this using Paul’s public address, 0xff0, from which he mapped out how funds were moved in and out from several other addresses. For example, 0xb74 transferred several NFTs, including 3 CryptoPunks, to the main public address.

Source: Zachxbt

Zachxbt wrote that Logan Paul had promoted several pumps and dump schemes over the course of a year. The first is the ELON token which he hyped in a leak video from his page.

The video leaked on May 10, 2021, and by May 17, blockchain records show Logan had sold his allocation of the tokens. He made $112k off the sale.

In what appears to be an obsession with the Tesla CEO, the next project Logan promoted was $FUCKELON. It seemed he bought it right before tweeting that the coin is mooning. Then he dumped the tokens, making $116k from the sale.

6/ Case 2: On 5/17/21 Logan promotes another pump and dump. His buys happen right before the Tweet and dump 12 hrs later for a $116k profit in total.

The Twitter account for the coin hasn’t tweeted since 5/27. pic.twitter.com/b3gGqfuKmV

— ZachXBT (@zachxbt) May 13, 2022

Logan Paul also promoted the Ethereum Max token in his boxing match with Floyd Mayweather. He got free tokens from the project and cashed them out for $71.8k.

The same token got promotions from other celebrities like Mayweather and Kim Kardashian. Those who bought the tokens are currently suing the developers and promoters for the failed project.

Another pump and dump scheme he got involved in was the failed DinkDoink crypto project. Again, he hyped the coin with videos and tweets, but it turned out that the coin was his creation.

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Beyond the crypto pumps and dumps schemes, the influencer also milked his followers with non-fungible tokens (NFT) projects. One of them was the CryptoZoo project which was Adobe stock pictures with nose photoshop.

9/ Logan’s other crypto project CryptoZoo blacklisted holders when they migrated contracts.

In an interview with The Block, Logan claimed the initial team was problematic but it is all rectified.

People like Bagsy still haven’t received anything despite following instructions pic.twitter.com/57KeVEr68H

— ZachXBT (@zachxbt) May 13, 2022

While the generic nature of the art is less of a problem, the project had blacklisted holders after migrating contracts. Logan Paul, however, claimed that this was a technical problem that has been rectified, but many investors are yet to receive their NFTs.

If the allegations are true, it would mean Logan Paul represents the crop of crypto influencers who capitalize on the trust of their followers to shill worthless tokens and make money.

Crime

Customers sue Coinbase for promoting and trading the GYEN token

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Customers sue Coinbase for promoting and trading the GYEN token

U.S.› Coinbase › Legal

The complaint claims that investors placed GYEN orders believing its value was pegged to the Japanese yen, but the price soared seven-fold before plunging 80%.

2 min read

Updated: May 14, 2022 at 4:17 am

Cover art/illustration via CryptoSlate

Coinbase customers have sued the exchange over the promotion and trading of GYEN, a stablecoin that crashed. A report unveiled this news earlier today, noting that the lawsuit targets both Coinbase and the issuer of the GYEN stablecoin, which turned out to be anything but stable.

According to the report, Coinbase’s customers filed a class-action lawsuit yesterday in a federal court in northern California. The lawsuit alleges that Coinbase and Tokyo-based GMO-Z.com, GYEN’s issuer, misled investors about the token’s stability. As a result, investors incurred losses worth millions of dollars.

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The complaint pointed out that GMO-Z.com issued GYEN with a 1:1 peg to the Japanese yen. However, GYEN’s value slipped below that of the Japanese yen in November last year after Coinbase listed and started trading it.

The complaint further noted that,

“Investors placed orders believing the coin’s value was, as advertised, equal to the yen, but the tokens they were purchasing were worth up to seven times more than the yen. Just as suddenly, the GYEN’s value plunged back to the peg — falling 80 percent in one day.”

Coinbase prevented customers from trading GYEN after the crash

Following the 80% crash, Coinbase halted GYEN’s trading. The complaint alleges that the exchange exacerbated the harm already caused by denying customers the opportunity to sell the asset. As a result, GYEN holders on Coinbase lost millions in a few hours.

The investors that filed the lawsuit asked to represent all GYEN investors. However, they did not specify the amount of compensation they seek.

At the time of writing, GYEN is trading at $0.007732. This amount is equivalent to the level the Japanese yen is trading against the U.S. dollar.

This news comes after Coinbase recently published its Q1 2022 earnings report. The report detailed that the exchange’s net revenue plunged 53% to hit $1.165 billion. Coinbase also recorded a net loss of $430 million.

Moreover, Sophia Zaller, a crypto underwriter at Relm Insurance, discovered a bankruptcy disclosure statement in the report. The statement noted that Coinbase could treat customers as general unsecured creditors in the event of bankruptcy. Zaller added that this is a red flag.

New disclosure in today’s $COIN (Coinbase) 10-Q: 👀

“In the event of a bankruptcy…..customers could be treated as our general unsecured creditors.” 🚩🚩🚩

🚨Get your #Bitcoin off exchanges.🚨 pic.twitter.com/KDBiAvYcog

— Sophia Zaller (@sophiamzaller) May 10, 2022

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As a result, investors started moving their funds off the exchange resulting in a sharp drop in COIN’s price.

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CBDCs

Record amounts of crypto were stolen in DeFi hacks last quarter

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Record amounts of crypto were stolen in DeFi hacks last quarter

Edge › Hacks

Over $1.26 billion worth of crypto was stolen from DeFi protocols in the first three months of 2022 — and it’s about to get worse.

3 min read

Updated: May 13, 2022 at 8:11 am

Cover art/illustration via CryptoSlate

After the record-breaking DeFi summer of 2020, the crypto industry has gone parabolic when adopting decentralized technologies.

The industry has been racing to reinstate traditional financial services in the decentralized world throughout the last year, drastically expanding the DeFi market.

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Crime

OneCoin creator, Ruja Ignatova, declared wanted in Europe

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OneCoin creator, Ruja Ignatova, declared wanted in Europe

E.U.› Bitcoin › Crime

Filings in the Southern District of New York suggest this damage could be over $4 billion.

2 min read

Updated: May 13, 2022 at 1:21 am

Cover art/illustration via CryptoSlate

Europol has placed the founder of OneCoin cryptocurrency, Ruja Ignatova, on its list of most wanted criminals.

The European law enforcement agency took this step in its concerted efforts to capture the “crypto queen” who is responsible for a multi-billion dollar fraud.

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The agency stated that Ignatova

Is suspected of having prompted investors worldwide to invest in this worthless “currency.”

It offered a reward of €5,000 for any information that’ll lead to the arrest of the alleged criminal mastermind.

OneCoin operated as a Ponzi scheme

Ignatova disappeared from the radar in 2017 after taking a flight from Sofia to Athens, where she was last seen with two Russian men. She created OneCoin in 2014, claiming it’ll be the token that replaces Bitcoin

“We are the Bitcoin killer. We’re faster, safer and cheaper,” she promised.

But it turned out that all those promises were false because the coin didn’t even make it to the blockchain. Instead, she spent the money on herself, and OneCoin turned out to be a Ponzi

Prosecutors told a US court that the scheme operated as a multilevel market network rewarding members for recruiting others.

RED NOTICE: Ruja Ignatova, dubbed ‘the Cryptoqueen’, is #wanted by Germany @bka for fraud and money laundering. A reward is offered for information leading to the arrest of the co-founder of the alleged cryptocurrency ‘OneCoin’ in hiding since 2017. https://t.co/vz1hwxok9p pic.twitter.com/jvGb8pg6gz

— INTERPOL (@INTERPOL_HQ) May 11, 2022

There are no exact figures of how much was actually lost to the scheme but some reports place the figure at around €88 million, with some saying it could be much higher. 

However, the Federal Criminal Police Office (BKA), one of those who have issued a search warrant for her arrest, stated that “the damage caused worldwide is likely to amount to several billion US dollars.” Filings in the Southern District of New York suggest this damage could be over $4 billion.

Ruja Ignatova’s brother arrested

Her brother, Konstantin Ignatov, has been arrested. Ignatov became the public face of the project after his sister disappeared. He was arrested in Los Angeles in 2019 on charges of wire fraud and cryptocurrency scams.

However, he’s currently helping the FBI in their efforts to arrest his sister after pleading guilty to the charges. According to Ignatov, the crypto queen has already withdrawn about €500 million from the money raised from investors.

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The BKA stated that Dr. Ruja Ignatova, who has a doctorate degree in law, is “likely the driving force and intellectual inventor of the supposed cryptocurrency ‘OneCoin’” and led the promotion of the worthless coin.

The search warrant highlighted that she may have altered her appearance given the considerable financial resources in her possession.

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