Logan Paul, a highly influential social media figure, is under renewed scrutiny over his cryptocurrency activities amid allegations that he may have profited by misleading his followers.
The BBC has uncovered evidence suggesting Paul promoted investment opportunities without disclosing his financial stake in them.
His influence, bolstered by over 23 million YouTube subscribers, appears to have driven up the value of these investments, raising concerns that he may have benefited from selling tokens he owned.
Paul is also facing a multi-million-dollar lawsuit related to a failed crypto project, CryptoZoo, but he denies any wrongdoing.
The BBC investigation found that, in 2021, shortly before Paul tweeted about a particular cryptocurrency, an anonymous wallet linked to his public crypto wallet traded in the coin, earning a $120,000 (£92,000) profit.
This discovery follows a Time Magazine report on similar activities involving a different cryptocurrency and another anonymous wallet.
Paul initially avoided speaking with the BBC about the investigation but later invited them to interview him at his gym in Puerto Rico.
However, when the crew arrived, a lookalike appeared in his place, accompanied by a crowd shouting abuse at the BBC.
Shortly after the disrupted interview, Paul’s lawyers sent a letter warning of potential consequences if the findings were published.
Meme coins
Logan Paul rose to global fame as an internet celebrity by sharing short video clips, initially on the now-defunct platform Vine and later on YouTube.
Around three years ago, Paul began increasingly referencing cryptocurrency, commonly known as crypto, in his content.
Crypto is a digital form of currency that operates independently of central banks, relying on secure technology for transactions.
In 2021, Paul endorsed several highly speculative crypto tokens known as “meme coins.” These tokens, often inspired by internet jokes or memes, are primarily traded within online communities.
Meme coins generally lack intrinsic value or practical use, making their worth highly volatile and prone to plummeting to zero.
Paul extolled the virtues of an Elon Musk-themed meme coin known as Elongate. “Elongate made me rich. Elon baby let’s go!” Paul announced in a video clip to Maverick Club, his subscription-only fan club.
Following this namecheck, the price of Elongate rose by over 6,000% to an all-time high. It then remained at that price for a few hours before it crashed.
We cannot be sure of Logan Paul’s intentions when he released his clip. However, it seems likely that his mention of Elongate affected its price.
Tech journalist Will Gotsegen says crypto is a market driven to some extent by social media and influencers: “A big guy with a lot of influence… someone like Logan Paul, buys a tonne of crypto and tells their followers about it. They’re going to buy it too.”
The anonymous crypto wallet analysed by the BBC appears to have close connections to Paul.
Anyone can see the transactions made by a wallet, but the owner can choose to remain anonymous. If an owner attaches their name or personal details it becomes a public wallet.
We could see that the wallet first received funds in February 2021 from a public wallet owned by Logan Paul. It then started buying and trading crypto.