Vegas Esports Weekly: FaZe Clan members busted for promoting crypto and Overwatch League in trouble with DOJ

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Photo: COURTESY OF FAZE CLAN/JUSTIN JERROD

Just because it was Fourth of July doesn’t mean the world of esports would take a break this week when it comes to news. If anything, the holiday weekend kicked the news cycle into overdrive. Multiple esports pro leagues continued to play through the weekend. Still, the biggest stories by far come from a pair of scandals, one of which led to a major organization announcing suspensions and terminations and the other leading to an investigation from the US Department of Justice. 

Esports No-no- FaZe Clan members caught promoting cryptocurrency scam

By far the largest story of the week, FaZe Clan announced in a statement on July 1 that it was suspending Jarvis, Nikan, and Teeqo from the organization and removing member Kay for their alleged roles in a cryptocurrency pump and dump scam. 

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The esports quartet allegedly promoted a cryptocurrency called “Save the Kids Coin,” encouraging their followers to purchase large amounts before selling off their stakes after their followers artificially inflated the coin’s value, which proceeded to plummet. 

Kay, who had been a member of FaZe Clan since 2013, issued an apology statement on Twitter last week, claiming to have had no ill intent when promoting the coin. The other three suspended members, including Kay’s brother, Jarvis, have not made a public statement.

The scam isn’t the only cryptocurrency-based scandal in the streamer space this week either, as Twitch streamer Adin Ross is in hot water for his role in a cryptocurrency promotion gone wrong as well. In June, Ross tweeted out a promotional $10,000 giveaway to his followers. To enter, followers had to sign up for a specific cryptocurrency platform and purchase a coin called Milf Token. 

Ross aggressively pushed the token on his stream before it turned out that the giveaway was never actually happening. In a video posted later by Esports news personality Jake Lucky, Ross says he hopes no one “actually bought” the scam currency. 

Overwatch League falls under DOJ antitrust probe

The Department of Justice announced this week that it is launching an antitrust investigation into the Overwatch League’s luxury tax salary cap system. The league implements a soft salary cap – $1.6 million for 2021 – to encourage parity and discourage teams from offering exorbitant contracts to stack rosters. If a team exceeds the cap, every dollar they spent above it must be paid double to the league itself, who then redistributes the money among non-offending teams. 

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The Overwatch League is being investigated for antitrust practices by the DOJ.

At the heart of the investigation, the issue is the league’s lack of a players union, which is what gives sports leagues such as the NFL, NBA, and MLB a labor exemption from current antitrust legislation. 

Activision Blizzard told Dot Esports, who first reported the story that they are fully cooperating with the investigation. Additionally, no team in 2021 has exceeded the cap, and very few teams in the league’s history have even come close. The probe is not a criminal investigation, and it is doubtful that Blizzard will be subject to harsh legal penalties. 

The week ahead in esports: 

While the largest news in esports has been out of the competitive scene, pro leagues are still very much in a swing for their summer series. Here is a look at the week’s upcoming events.

  • CS:GO’s Pinnacle Cup II Continues

Counter-Strike: Global Offensive remains a popular game in the competitive scene, despite being roughly as old as the creation of the sun. Pinnacle Cup II is a three-stage tournament organized by Relog Media and is currently in the middle of its second stage, a 16-team Swiss Bracket. The top 8 teams from the bracket will advance to meet four previously invited teams in a single-elimination playoff to crown a champion. 

  • League Of Legends Summer Split Week 5

The LoL Summer Split continues, with 100Thieves looking to continue their eight-game winning streak when they take on the last place Golden Dragons this weekend. Meanwhile, former titans, Counter Logic Gaming find themselves in eighth place as losses continue to pile up. They take on fifth place Evil Geniuses this Saturday to right the ship. 

  • Call of Duty League Begins New York Home Series

The groups have been drawn, and it is time for Stage 5 of the Call of Duty League to begin, starting on July 8 with Atlanta FaZe taking on the London Royal Ravens to begin the New York Home Series. 

Atlanta will be the favorites coming off victory in the Stage 4 Major, but draw the New York Subliners in their group, who could thwart their attempt at a flawless 5-0 series. The Subliners worst-to-first success story remains one of the best stories in Esports, with the team starting Call of Duty League as one of the worst teams before changing rosters and climbing the ranks, coming close to winning the League’s inaugural season. 

Meanwhile Group B is headlined by the Toronto Ultra and Dallas Empire, the third place and runners up at the Stage 4 Major respectively. 

The teams will square off in five series matches during three weeks of online group play. The top three teams from each group will begin the Stage 5 Major in the winner’s bracket. 

Do you have an esports league, team, or story you want to see covered in our digest? Let me know by reaching out on Twitter to @TVatWork!