FaZe clan has suspended 3 members and booted one entirely over their involvement in a shady "pump and dump" cryptocurrency scheme.
In June, FaZe members Kay, Jarvis, Nikan and Teeqo were involved in the launch of an alt-coin (an alternative to things like Bitcoin and Ethereum) called Save The Kids. The big sell for this particular token was the promise that a percentage of proceeds from sales would go to charity, and Kotaku (opens in new tab) reports that the coin attracted plenty of influencers.
Naturally, fans of the esports personalities signed on and paid up to get their hands on these coins. A day or two later, however, and crypto did what crypto does best (opens in new tab). The value of the coin crashed, hitting anyone still holding onto one with a massive loss.
In a statement this week, FaZe leadership announced that it had no involvement with the scheme and condemned the four members' behaviours. Jarvis, Nikan and Teeqo have been suspended indefinitely from the group, while Kay has been removed entirely.
A statement from FaZe Clan. pic.twitter.com/HnPXpAoSYXJuly 1, 2021
Following several investigative videos into the promotion from YouTubers like Coffeeezilla (opens in new tab) and SomeOrdinaryGamers (opens in new tab), Kay wrote that he had "no ill intent" with the promotion, claiming to have simply failed to do adequate research before promoting the token.
"I honestly & naively thought we all had a chance to win which just isn’t the case," Kay tweeted (opens in new tab). "I didn't vet any of this with my team at FaZe and I now know I should have."
But it's been suggested that this release had many of the hallmarks of a "pump and dump" scheme, a colloquial term for getting high-profile buyers to promote and push up up the value of a token ahead of launch before selling as quickly as possible, extracting as much money out of it as possible before its value crashes.
Having previously been accused (opens in new tab) of involvement with shady crypto schemes, FaZe founder Banks distanced himself from these latest accusations, tweeting (opens in new tab): "I've never one time been a part of a pump and dump. That's never happened, please do your research. My wallets public. I wasn't a part of any of this."
None of the accused FaZe members have spoken publically since their suspension / removal.