Logan Paul announces he will buy back NFTs from his failed CryptoZoo project

YouTuber Logan Paul announced a $2.3 million buyback program to repay participants in his defunct NFT-based game CryptoZoo, which he launched in 2021.

Paul shared details of the buybacks in an X post on Thursday. The game was supposed to allow players to purchase base egg non-fungible tokens (NFTs), or unique digital assets. Eggs would hatch into base animal NFTs, which could then be bred into hybrid animal NFTs. Players were supposed to be able to earn $ZOO tokens, the in-game cryptocurrency that could be used to buy more NFTs or cashed out, by hatching eggs.

Only base eggs and base animals are eligible for the buyback program. Each eligible NFT can be exchanged for 0.1 Ethereum, which is a popular cryptocurrency. 

Paul faced criticism for the CryptoZoo project after participants said the game did not work. Paul and his associates were named in a class-action lawsuit in February 2023. The lawsuit alleges that CryptoZoo is a “fraudulent venture.”

“Defendants promoted CryptoZoo Inc.’s products using Mr. Paul’s online platforms to consumers unfamiliar with digital currency products, leading to tens of thousands of people purchasing said products,” the lawsuit said. “Unbeknownst to the customers, the game did not work or never existed, and Defendants manipulated the digital currency market for Zoo Tokens to their advantage.”

Participants in the buyback program must waive their right to sue Paul over CryptoZoo.

Paul is one of numerous public figures to be scrutinized for their promotion of NFTs and cryptocurrency, which have been criticized in the past for their volatile financial values. Celebrities like Cristiano Ronaldo and Kim Kardashian have been sued in the past for promoting various NFT and cryptocurrency projects.

When asked for comment, legal representatives for Paul referred NBC News to his statement on X.

Paul wrote on Thursday that he was “highly disappointed that the game was not delivered.” He also said that the game would not be released due to regulatory issues.

“This buy-back is a way for me to make whole those who intended to play CryptoZoo,” Paul wrote on X. 

Tom Kherkher, the attorney representing the plaintiffs in the class action against Paul and CryptoZoo, called the buyback program a “non-starter” for CryptoZoo victims in an email statement.

“While the buy back offers a limited reimbursement for ‘base eggs and animal NFTs,’ participation in the buy-back requires participants to waive any legal recourse against Mr. Paul,” Kherkher wrote in an email. “… This complete waiver is material because our data suggests that $ZOO token was chiefly responsible for the vast majority of financial harm.”

In his social media post, Paul said that “CryptoZoo was derailed by bad actors” and alleged that they “betrayed our team while internally sabotaging the game.” On Thursday, he submitted an answer to the class action requesting the case be dismissed. He simultaneously filed a cross-claim against Eduardo Ibanez and Jake Greenbaum who helped him with the game, alleging they defrauded him. 

Ibanez and Greenbaum did not immediately respond to requests for comment.