‘Fan token’ company Socios accused of crypto price manipulation

Alexandre Dreyfus, the CEO and founding father of fan token web site Socios, has been accused of withholding funds with a view to keep the value of Chiliz (CHZ), the cryptocurrency utilized by the Socios group, in accordance with a report from Off the Pitch.

Fan tokens are tied to real-life sports activities groups, creators, or artists, and provides token holders entry to unique fan golf equipment the place they’ll vote on choices inside their group. In Socios’ case, the platform facilities round sports activities, with customers shopping for Chiliz to buy the fan tokens representing numerous groups in soccer, soccer, motorsports, and extra.

As reported by Off the Pitch, Dreyfus allegedly didn’t pay a few of his advisors an agreed-upon share of Chiliz in trade for endorsing the cryptocurrency. An unnamed tech government informed Off the Pitch that he solely acquired “some portion of what was promised,” and claims Dreyfus began “avoiding all communications with the advisors” in September 2020.

His purpose for not paying out advisors? An inside message from Dreyfus considered by Off the Pitch signifies Dreyfus didn’t need the worth of Chiliz to tank. “We additionally want to guard the traders,” Dreyfus writes within the screenshotted message. “While you give free tokens, folks can promote at any worth — it would not matter for them.” He then went on to notice that the “actual traders” who purchased Chiliz could possibly be dropping cash on account of advisors promoting off the forex.

The tech government referred Off the Pitch to 3 different advisors who additionally allegedly went unpaid, and acquired affirmation from one in all them. Oddly sufficient, that one advisor reached out to Dreyfus as soon as once more — the context of their dialog unknown — and reported again to Off the Pitch that every one 4 advisors had lastly been paid in full. It’s unclear if there are nonetheless different Chiliz advisors that stay unpaid.

“We remorse that some advisers which have labored with us up to now weren’t paid in a well timed method and we have now rectified this with them immediately and keep good relationships immediately,” a Chiliz spokesperson informed Off the Pitch. “The agreements have been made when the corporate was pre-start up and at the moment we weren’t in a position to award CHZ immediately because it wasn’t listed on any exchanges. To be clear, this delay is unacceptable and never the way in which we wish to run our enterprise, and falls wanting the requirements to which we maintain ourselves immediately.”

Workers members, who have been additionally alleged to obtain a portion of their wage in Chiliz, weren’t so fortunate. When the worth of Chiliz skyrocketed, one worker claims they have been unable to money in on the $10 million allegedly owed by Dreyfus. Chiliz later ushered in a brand new contract to switch those beforehand signed by workers, leading to a smaller allotment of crypto, Off the Pitch reviews. The worker who was owed $10 million supposedly solely made off with round $60,000 on account of the brand new settlement. One other employees member was reportedly fired after talking out in regards to the situation to the press.

Chiliz responded to Off the Pitch’s report in a submit on Medium, stating that it “doesn’t replicate the reality of the matter.”

Replace March twelfth 6:05PM ET: Up to date so as to add the response from Chiliz.