Socios, a 'fan token' startup, has been accused of manipulating cryptocurrency prices

Socios, a ‘fan token’ startup, has been accused of manipulating cryptocurrency prices

Alexandre Dreyfus, the CEO and founder of fan token platform Socios, has been accused of withholding payments to keep the price of Chiliz (CHZ), the cryptocurrency used by the Socios community, stable.

Fan tokens are associated with real-life sports teams, creators, or artists, and grant token holders access to private fan clubs where they can vote on community choices. In the case of Socios, the platform revolves around sports, with users purchasing Chiliz in order to purchase fan tokens representing teams in soccer, football, motorsports, and other sports.

Dreyfus allegedly failed to pay a portion of Chiliz to some of his advisors in exchange for advocating the cryptocurrency. According to an unidentified IT executive, he only received “a part of what was promised,” and Dreyfus began “avoiding any discussions with the advisors” in September 2020.

His justification for not compensating advisors? Dreyfus stated in an internal mail that he did not want Chiliz’s value to plummet. In the screenshotted message, Dreyfus writes, “We also need to safeguard the investors.” “When you give away free tokens, people can sell them for any price they want.” He went on to say that “genuine investors” who purchased Chiliz may be losing money as a result of advisors selling the currency.

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