In A Case Involving A Cryptocurrency Scheme, Soulja Boy And Lil Yachty, Among The Stars Being Sued
Soulja Boy, Lil Yachty, and Jake Paul are among the names listed in a class-action lawsuit over a purported "pump and dump" scheme meant to benefit SafeMoon founder Braden John Karony and other top-level executives, according to ClassAction.org.
SafeMoon used Soulja, Yachty, and Paul, along with Nick Carter and YouTuber Ben Phillips, to promote its tokens and increase investor numbers. By endorsing tokens, they enhanced their value while misleading statements made to investors led them to believe the best was still to come. However, the suit alleges that this entire strategy served as a ploy to "pull the rug out from under" the plaintiff.
SafeMoon tokens crashed in 2021, after which they struggled to stabilize. SafeMoon Token fell over 80 percent from peak price during the Class Period to a low of $0.0000006521 on Dec. 31, 2021, and has not recovered, according to the lawsuit. According to this complaint, SafeMoon's trading volume has plummeted to less than $60,000 since the filing of this lawsuit.
The SafeMoon token was created in March 2021, and it featured the alarmingly suspect phrase, "safely to the moon," suggesting that this latest entry in the cryptocurrency game would reach new heights in a "safe" manner. While SafeMoon's celebrity investors were driving up its investor numbers, it was notifying them of "token burns," or the removal of a certain number of tokens from circulation. Investing in this method made investors believe that their tokens would surely increase in value.
When the shine from the celebrity endorsements wore off, and token trading volume declined, SafeMoon used that same approach once again and it worked. Less than a month after its inception, SafeMoon told investors their profits would be "going to the moon" imminently after nearly four trillion tokens were "burned."
Marketing efforts for SafeMoon included YouTube ads, social media awareness, and even a Times Square billboard. These factors increased the value of its tokens, but over time, trading volume declined. Hank Wyatt resigned as chief technology officer and sold his tokens to unsuspecting investors after SafeMoon's value was revitalized by the "imminent" arrival of the wallet. According to the lawsuit, Wyatt "knew or should have known" that the wallet's launch failed.
Wyatt resigned on Sept. 9, 2021, and Haines-Davies stepped down on Sept. 10, 2021, causing the token price to plummet. Several others left SafeMoon "under similar circumstances."