Jimmy Donaldson, the famous YouTuber also known MrBeast, is at the center of another controversy involving claims of promoting cryptocurrencies that many have claimed could have served to unjustly enrich the YouTube star at the expense of the average investor.
One of the most popular creators of viral charity and entertainment videos, MrBeast currently holds the title of the most-subscribed creator on YouTube. Contrary to this, a recent investigation by blockchain sleuth SomaXBT claims that he made his fortune by touting unknown cryptocurrency projects, inflating their values, and then selling his holdings once prices went sky-high.
Allegations of Pump-and-Dump Activity
SomaXBT-a blockchain researcher-published a deep dive in a report detailing how MrBeast made roughly $10 million on several crypto projects, including SuperFarm SUPER and Polychain Monsters PMON. He would, the report said, support such low-cap tokens, increase their exposure before his large following, and later sell when prices inflated. This practice, sometimes referred to as a “pump-and-dump” scheme, has the potential to harm small investors who buy at high prices, only to watch token values crash later.
1/ An investigation into @MrBeast ,how he allegedly made $10M+ by backing low-cap IDO crypto tokens promoted by influencers like Lark Davis, CryptoBanter, KSI, and others. Many of these projects are now down over 90%, with some rebranding after major losses.
— SomaXBT (@somaxbt) October 11, 2024
let's dive in. 🧵 pic.twitter.com/NR9dq9ZnD2
That report, for instance, quotes that MrBeast invested $100,000 in SuperFarm, a crypto project started by Elliot Trades-another influencer. When the project took off and the price of the token surged, he reportedly sold his shares for net profits of about $9 million. Similar trends continued with other projects, including Polychain Monsters, where, per him, an investment of $25,000 yielded considerable returns.
Community Reaction and Ethical Questions
While this may not be illegal, the move by MrBeast has raised ethical debates in the crypto community. As critics have noted, influencers should be crystal clear with regards to their intentions, especially when the financial products they are endorsing could have an effect on retail investors.
The case has brought into view the broader issue of how social media influence crypto markets, where surges in the price of an asset often follow celebrity endorsements. For many, it’s just another reminder to tread influencer-driven projects with care.
Also read about What is Consensus in Blockchain?
Regulation and Future Implications
Crypto regulation is still very much in its developing phase, and this case has underlined the challenge of navigating promotional activities in an unregulated space. It also remains to be seen whether any action will be taken against MrBeast.
The continued discussion underlines the need for ethical transparency on the part of communicators, with crypto being a particularly salient space given price volatility that may result in significant losses for smaller investors.
Conclusion
This new accusation gives a view on the power of YouTubers and social network stars over financial markets. Having MrBeast in the crosshairs, many are hoping this will serve as a wake-up call for regulators in establishing clear rules over crypto promotion. For investors, this situation is a reminder to do their research and remain cautious about projects promoted by influencers.
