Some industry commentators claim a growing knowledge gap could leave future victims vulnerable.
In a shocking twist for the crypto and YouTube communities, mega influencer Logan Paul announced last week that his two-year legal battle over the failed NFT project CryptoZoo has been dismissed by a judge.
Paul, who was accused alongside several associates of defrauding investors, is now officially cleared of all charges related to the class-action lawsuit filed in early 2023.
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According to court filings reviewed in late October, a U.S. magistrate judge reaffirmed the dismissal of the class action against Paul, effectively ending his involvement in the case.
The lawsuit, filed by YouTuber and attorney Tom (known online as Attorney Tom), had accused Paul and other defendants of fraud, breach of contract, unjust enrichment, and conspiracy to commit fraud.
AttorneyTom sued CryptoZoo in 2023 | Source: AttorneyTom YouTube
However, in August, the judge found insufficient evidence directly tying Paul to the alleged misconduct, noting that the plaintiffs “failed to justify” his inclusion as a defendant.
Paul’s defense attorney, Jeffrey Neiman, celebrated the ruling in a LinkedIn post, writing that “telling Logan Paul 30 minutes after his fairy tale wedding that a magistrate judge recommended a complete dismissal… was an unforgettable moment.”
Despite criticism over the tone of the post and massive pushback from the community, the October ruling made it official that Paul would not face any further legal consequences in connection with CryptoZoo.
The History of the CryptoZoo Scandal
The class action stemmed from CryptoZoo, an NFT game promoted by Paul in 2021 that promised users they could buy, hatch, and trade digital “animal” NFTs for profit.
Despite millions raised in NFT sales, the project failed to deliver a playable game for users.
Developers later claimed they had not been paid, and community members went viral, exposing that none of the promised features had been implemented.
As with many YouTuber crypto projects, the venture didn’t last long, quickly collapsing and leaving investors with worthless tokens.
In December 2022, YouTuber-investigator Coffeezilla released a three-part exposé alleging that CryptoZoo was a “rug pull” and that Paul had misled his followers.
The series went viral, reigniting criticism over influencer-backed crypto ventures and Paul himself.
In early 2023, Paul issued an apology video and promised to refund affected users out of his own pocket.
In February 2023, a lawsuit from Attorney Tom sought damages for thousands of participants who claimed to have lost money when the project collapsed.
Influencer Crypto Scams Are Rife
Logan Paul’s victory arrives amid an unfortunate wave of controversies linking online influencers to questionable crypto projects.
Paul himself had faced scrutiny before CryptoZoo, that time for promoting a now-defunct memecoin called Dink Doink, which he once claimed to be “all in” on.
this is the dumbest, most ridiculous shitcoin I’ve ever seen. And that’s why I’m all in 📈 https://t.co/NwD0pTO4dQ
The coin’s rapid rise and collapse were early, yet typical indicators of a pattern where influencers lured impressionable fans into speculative projects that quickly lost value.
Jake Paul, Logan’s brother, has also been entangled in multiple crypto investigations.
In 2023, he was among several celebrities, including Lindsay Lohan, Soulja Boy, and Lil Yachty, charged by the U.S. Securities and Exchange Commission (SEC) for promoting tokens without disclosing that they were paid endorsements.
Jake Paul has been in a number of controversies | Source: Jake Paul Youtube
He settled the charges for more than $400,000 without admitting wrongdoing.
Jake Paul was also named in a separate class-action lawsuit tied to SafeMoon, which alleged that celebrity backers made misleading statements to inflate the token’s value before its crash.
Adam Grandmaison, the podcast host better known as Adam22, was similarly accused of front-running his audience through a memecoin scheme earlier this year.
After announcing a token on social media, the project’s market cap surged before collapsing when insiders reportedly sold large portions of their holdings.
Coffeezilla leaked DMs between him and Adam22 | Source: Coffeezilla
YouTuber scam sleuth Coffeezilla shared direct messages showing he had warned the influencer beforehand:
“Real talk, you shouldn’t run a coin. It’s lame and you’re gonna scam or get scammed.”
Adam22 later responded:
“I just got paid to do the tweet I got nothing to do with it.”
The Uncomfortable Truth
The CryptoZoo ruling has also exposed a growing gap between traditional courts and the rapidly evolving world of digital assets.
The judge overseeing Paul’s case, believed to be in his 50s or 60s, has been accused by some of not understanding the intricacies of NFTs and crypto.
YouTuber Scott Shafer, who has followed the case closely, said in a recent video:
“This really comes down to the judge not really fully understanding cryptocurrency. If you don’t know how NFTs work, you’re making an option contract on the blockchain. I don’t think [the judge] fully understands how it works.”
As the wild world of crypto continues to claim victims from influencers, judges trained before the digital economy existed will continue to be asked to interpret blockchain systems.
If this is the case, without more education, victims could continue to stand lose thousands.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
