MrBeast and 9 Other Influencers Scrutinized for Crypto Scams

YouTube star MrBeast isn't the only famous name linked to an alleged cryptocurrency pump and dump scheme.

crypto.news found at least nine other scenarios in which a celebrity or influencer promoted a coin to investors, only to sell their holdings at an inflated price. The price of the digital asset subsequently plummeted, leaving other investors (often its fans) with significant losses.

Still, most celebrity projects usually fail shortly after launch. But there are notable cases that continue to emerge that alarm regulators and remind investors to conduct research before pursuing high-profile promotions. Here's our list, starting with Donaldson.

Mrbeast

On Tuesday, MrBeast, whose real name is Jimmy Donaldson, allegedly made millions of dollars from questionable crypto deals.

Experts from advisory firm Loock.io and blockchain analysts such as SomaXBT, who previously accused Donaldson of making $10 million from low-cap tokens, say MrBeast leveraged his influence to benefit from insider trading.

According to a group of network researchers, Donaldson, who has 320 million subscribers on YouTube, uses his influence to promote tokens, “only to then launch them on the market.”

Cryptocurrencies aren't the only thing Donaldson promotes. The stunt video specialist is also known for promoting food products, including “Beast Burgers” and “Lunchly.” Observers scrutinized the low quality standards of both.

logan paul

Logan Paul, who associated with MrBeast on Lunchly, he is also a popular YouTuber known for his controversial stunts and product endorsements, including his own energy drink brand, Prime.

One of its most notable puffs has to do with CryptoZoo, a non-fungible token (nft) game that allows players to purchase digital eggs that would hatch into animals. These nfts could be traded or sold, with players potentially making a profit.

However, after initial sales and marketing, the project stalled, leaving many investors with nfts that were effectively worthless.

Critics, including YouTuber Coffeezilla, accused Paul and his team mismanaged the project and misled investors.

Paul later responded to the allegations, blaming third-party developers for the problems and promising to address concerns, although the status of the project remains contentious.

kim kardashian

In late 2022, a federal judge dismissed a lawsuit accusing Kim Kardashian and other celebrities of promoting a cryptocurrency “pump-and-dump” scheme linked to EthereumMax (EMAX).

Investors alleged that E! The reality star misled the public by promoting EMAX, a cryptocurrency that is now almost worthless. The court determined that the claims did not meet the “strictest pleading standards” necessary for securities fraud, meaning the evidence presented was insufficient to proceed with the case.

This firing followed Kardashian's previous settlement with the SEC, where she agreed to pay a $1.26 million fine for failing to disclose that she had been paid $250,000 to promote EMAX.

As part of the deal, it also agreed to avoid supporting any crypto products for three years.

The plaintiffs retained the right to appeal, but the case highlighted the legal and ethical complexities around influencer marketing in volatile markets like cryptocurrencies.

Floyd Mayweather

In 2022, regulators accused undefeated boxing champion Floyd Mayweather of failing to disclose payments for promoting three initial coin offerings (ICOs), including a $100,000 payment from Centra tech.

They allege that he twitter.com/FloydMayweather/status/909911035263328256″ target=”_blank” rel=”nofollow”>used his social media platform to encourage his fans to participate in the Centra ICO, stating that it would start soon and that they should purchase tokens before they ran out.

However, Centra tech was later discovered to be fraudulent. Its founders, Sohrab Sharma, Raymond Trapani and Robert Farkas, were accused by regulators of defrauding investors by making false claims about partnerships with major companies such as Visa and MasterCard. Authorities also alleged that the company misled investors about the technology and viability of its debit card product.

Mayweather's involvement drew significant criticism from ZachXBT, a popular blockchain researcher. ZachXBT cited numerous other situations where the wrestler's followers lost substantial amounts after investing in a scam, including Kardashian-backed EthereumMax.

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DJ Khaled

DJ Khaled, whose real name is Khaled Mohamed Khaled, also promoted Centra tech on social media.

Like Mayweather, Khaled was accused of failing to disclose that they were paid to promote the ICO, which violated anti-promotion provisions.

As a result, in 2018, Khaled settled with the US Securities and Exchange Commission (SEC) by paying a fine of $152,725 (Mayweather paid more than $600,000). This included disgorgement of profits and additional penalties.

Khaled also agreed not to promote any titles for two years. This case marked one of the SEC's first actions against celebrity endorsements in the crypto industry, setting a precedent for transparency and accountability in such endorsements.

soulja boy

The SEC accused the rapper and social media influencer of allegedly promoting TRON (TRX) and BitTorrent (BTT) without disclosing that he was being paid.

Soulja Boy, along with other influencers, faced legal backlash as he continued to promote various coins and nfts despite the risks.

Jake Paul

YouTuber and boxer Jake Paul, brother of Logan Paul, faced a lawsuit for allegedly promoting the SafeMoon cryptocurrency without disclosing his financial interest in it.

SafeMoon's value fell sharply after promotions by Paul and other celebrities.

It doesn't end there. Another incident was Paul's association with Save the Kids, a cryptocurrency project that claimed to support charitable causes.

The project faced significant backlash and scrutiny when it was alleged that Paul and others promoted the token to inflate its price and then sold their holdings, causing a sharp drop in its value, resulting in substantial losses for investors.

Paul denied any wrongdoing.

Lindsay Lohan

In 2023, Lindsay Lohan was one of several celebrities, including Jake Paul, who faced charges from the SEC for allegedly promoting the Tron Foundation's TRX and BTT tokens without proper disclosures.

The case highlighted that she and others were paid to back these tokens.

But Lohan often promoted crypto projects and nft collections on social media. A spreadsheet leaked by ZachXBT on social media suggested the “Mean Girls” star regularly charged $25,000 for shill projects, or $20,000 for a retweet.

That sparked unwanted attention from the SEC, which accused her of boosting Justin Sun's Tron and BitTorrent tokens.

He eventually settled the SEC charges and joined companies like Ne-Yo and Akon in paying a combined total of $400,000.

Paul Pierce

The former NBA star promoted EthereumMax on his social media in 2021 without revealing his payout, just like Kardashian and Mayweather. Pierce eventually settled with the SEC in 2023, paying a $1.4 million fine.

The lawsuit filed against these celebrities accused them of engaging in a pump and dump scheme, in which they allegedly promoted EMAX to inflate its price and then sold their holdings, causing significant losses for retail investors who were attracted to their endorsements. . While Pierce and his fellow promoters have denied any wrongdoing, the legal implications of their endorsement highlighted concerns about celebrity influence in the cryptocurrency market.

The EMAX crackdown was part of a broader effort to investigate celebrity endorsements in the cryptocurrency space. This situation has drawn attention to the legal responsibilities of influencers when promoting financial products.

andres tate

YouTuber Coffeezilla, known for exposing scams, is in a public dispute with proud misogynist Andrew Tate over the influencer's changing stance on cryptocurrencies.

Coffeezilla shared previous clips of Tate, who once dismissed cryptocurrencies as useless and claimed he would not exploit fans by flipping coins. Despite this, Tate has since promoted multiple meme coins, including “ROOST” and “F Madonna token,” both of which lost significant value shortly after their endorsement.

Coffeezilla also highlighted Tate's promotion of the “Real World Token,” linked to Tate's online course, which resembles a pyramid scheme, in which subscribers earn tokens representing profit sharing.

Tate, who was arrested in Romania in 2022 on human trafficking charges, has maintained his innocence as his legal troubles continue to attract public attention.