People who bought into CryptoZoo, Logan Paul‘s self-described “really fun game that makes you money,” are being offered a $200 refund.
Paul introduced the project on his podcast back in 2021. The vision was a hybrid NFT/game project: CryptoZoo-the-NFT-collection would launch first, allowing people to buy digital “eggs”; then, once CryptoZoo-the-game launched, the eggs would hatch into (potentially Adobe stock photo-based) jpegs of chimera-esque animals. Hatches generated $ZOO token, CryptoZoo’s cryptocurrency, and animals could be bred to produce hybrids.
The whole thing was a bit mystery box-like. People who bought eggs couldn’t tell what animals they’d get, and also couldn’t tell how rare those animals would be, or how much $ZOO token they’d get when their eggs hatched.
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With CryptoZoo-the-NFT-collection, it debuted in September 2021, and nearly 3,000 eggs were minted on OpenSea, with a starting mint price of .1 ETH. Buyers understandably anticipated using those eggs in the upcoming promised CryptoZoo-the-game.
However, over a year later, CryptoZoo-the-game still hadn’t materialized. Coffeezilla did a thorough investigation into was going on behind the scenes at CryptoZoo during that year, which you can watch here, but the tl;dr is that Paul claimed there were bad actors involved in CryptoZoo-the-game’s development that put financial strain on the project and prevented it from being completed. Around the same time, Paul promised that he would look into ways to make things right for people who’d bought CryptoZoo NFTs, which had tanked in value and, without the game, didn’t have much functionality.
Now, over a year after that, Paul has introduced a buyback program for those NFT owners. In a tweet, he said he’d put down $2.3 million of his own money to buy back every base egg and base animal NFT for 0.1 ETH, or around $227 at Ethereum’s current value.
But there’s a catch.
Today, I am incredibly happy to announce that I am delivering on my promise to buy back Base Egg and Base Animal CryptoZoo NFTs for their original purchase price. This buy-back program is being carried out at https://t.co/XIQzLAGKiG. Claims can be submitted through this site… pic.twitter.com/VMPDHvdXkq
— Logan Paul (@LoganPaul) January 4, 2024
If people accept that refund, they waive the right to bring any “actual or anticipated claims against Paul” to court. Aka, they can’t sue him–or participate in any CryptoZoo class action lawsuits.
And there is, in fact, an ongoing CryptoZoo class action lawsuit. It was filed in February 2023 by Houston-based attorney Tom Kherkher on behalf of all CryptoZoo NFT buyers, and accuses CryptoZoo of being a “rug pull” that paid out to its founders, but negatively impacted NFT buyers.
In his tweet about the buyback, Paul said he “never made a single penny from the project, period.”
“In fact, the opposite is true, because I spent hundreds of thousands of dollars trying to make it happen,” he said.
Kherkher, who has 544,000 subscribers on his YouTube channel AttorneyTom, uploaded an “emergency update” after the buyback offer went live. His opinion of the offer is less than positive.
“I think this buyback is a sneaky trick,” he said, referring to the clause that requires people to waive their right to sue if they accept a refund. “Our recommendation to our clients is, we’re still pursuing this case anyway. Our recommendation to our clients is, do not engage with this refund because of this language.”
Kherkher said the buyback also doesn’t cover $ZOO token, despite the currency at one point having “billions of dollars in trading volume.” Plaintiffs in the class action suit he filed are seeking compensation for their $ZOO token, too.
“I’m just worried that a victim out there who has one NFT and $5,000 of $ZOO token, or $1,000 of $ZOO token, or $10,000, or $100,000, whatever it is, they’re going to get their $200 refund for their NFT and, as a result, the rest of their claim is going to be waived,” he said. “It’s just disheartening, and I think people should know what the consequences of that are.”
Kherkher said he is prepping an amended claim against Paul that was already in progress before the buyback program was introduced. That’ll be filed “in the coming days.”
Paul, meanwhile, has just filed his own suit, a cross-complaint that accuses CryptoZoo developers Jake Greenbaum and Eduardo Ibanez of being “con artists” who “sabotaged” the project.
He also clarified on Twitter that no matter what happens with ongoing lawsuits, CryptoZoo-the-game “unfortunately […] will not be released.”
“I personally spent $400,000 to have it developed and after its completion in early 2023 & some further diligence, unfortunately, there are too many regulatory hurdles that would need to be cleared that I did not originally understand and would ultimately delay this buy-back even further,” he said.
