‘Fan token’ company Socios accused of crypto price manipulation

Photo illustration by Jakub Porzycki/NurPhoto via Getty Images

According to a report from Off the Pitch, the CEO and founder of Socios has been accused of withholding payments in order to maintain the price of Chiliz.

Fan clubs give token holders access to vote on decisions within their community and are tied to real-life sports teams, creators, or artists. In Socios, the platform centers around sports, with users buying Chiliz to purchase the fan token representing various teams in soccer, football, motorsports, and more.

According to Off the Pitch, Dreyfus failed to pay some of his advisers an agreed upon share of Chiliz in exchange for endorsing thecryptocurrencies. An unnamed tech executive told Off the Pitch that he only got some portion of what was promised, and that Dreyfus avoided all communications with the advisors in September 2020.

Why didn't he pay out advisors? Dreyfus wrote in the message that he didn't want the value of Chiliz to tank.

The tech executive referred Off the Pitch to three other advisers who were not paid, and got confirmation from one of them. One of the advisors reached out to Dreyfus once more, and told Off the Pitch that all four of them had been paid in full. It is not clear if there are still other Chiliz advisors that are still not paid.

Chiliz regrets that some advisers that have worked with them in the past were not paid in a timely manner, and they have rectified this with them directly. To be clear, this delay is unacceptable and not the way we want to run our business, and falls short of the standards that we hold ourselves today.

Staff members who were supposed to get a portion of their salary in Chiliz were not so lucky. One employee claims they were unable to cash in on the $10 million owed by Dreyfus when the value of Chiliz skyrocketed. Chiliz ushered in a new contract to replace the ones previously signed by employees, which resulted in a smaller amount of coins. The employee who was owed $10 million only made off with $60,000 after the new agreement was reached. A staff member was fired for speaking to the press.

Chiliz wrote on Medium that the report does not reflect the truth of the matter.

The response from Chiliz has been added.