Logan Paul's Pikachu Illustrator Card Sells for Record $16.5M, Reigniting NFT Controversy

Logan Paul's recent sale of a Pikachu Illustrator Pokémon card for $16,492,000 has made headlines, securing a Guinness World Record and generating significant buzz within the collectible and cryptocurrency communities. The card, one of only 39 ever produced and graded a PSA-10 (the highest grade possible), was purchased by AJ Scaramucci, son of financier Anthony Scaramucci, after a competitive auction held by Goldin Co. Paul reportedly acquired the card in July 2021 for $5.3 million, potentially realizing an $8 million profit after auction fees.

Despite the celebratory fanfare, the record-breaking sale has resurfaced past controversies surrounding Paul's foray into the NFT space. Specifically, it brought renewed attention to his 2022 attempt to fractionalize ownership of the same Pikachu Illustrator card on Liquid Marketplace. The platform subsequently went offline, leaving investors with tokens representing fractions of the card and prompting a lawsuit in Canada.

The controversy hinges on the nature of 'slop tokenization,' a term coined by Delphi Labs general counsel Gabriel Shapiro to describe situations where tokens are loosely associated with underlying assets without conferring any genuine rights to them. Shapiro argued that the tokens associated with Paul's fractionalized Pikachu card had no real legal claim to the physical card. Paul, in response, has stated that Liquid Marketplace shut down due to circumstances beyond his control and that he personally funded the restoration of the site to allow users to withdraw their funds. He also noted that only 5.4% of the card was fractionalized, with investors paying approximately $270,000.

The Liquid Marketplace lawsuit, filed by the Ontario Securities Commission, does not name Paul directly, but the situation highlights the risks associated with fractionalized NFTs and the importance of understanding the terms of service before investing. A hearing is scheduled for June 2024, to resolve legal matters.

This isn't Paul's first brush with NFT-related controversy. His CryptoZoo NFT project, launched in 2023, faced criticism for failing to deliver its promised play-to-earn game, resulting in investor backlash and a class-action lawsuit. To mitigate the damage, Paul established a buyback program, compensating investors in exchange for waiving their legal claims, ultimately leading to the dismissal of the lawsuit in 2025. Other NFT investments by Paul have also depreciated significantly in value, illustrating the volatile nature of the digital asset market.

The success of the Pikachu Illustrator sale starkly contrasts the current downturn in the broader NFT market. After a promising start to 2026, the total NFT market capitalization has plummeted by over 50%, falling from $3.2 billion to $1.55 billion. Several prominent NFT marketplaces, including Rodeo and Nifty Gateway, have recently announced closures, signaling the challenges facing the sector as a whole. This serves as a cautionary tale about the speculative nature of digital assets and the potential for rapid shifts in market sentiment.