Controversial YouTube Sponsor Honey Loses Over 7 Million Users
PayPal-Owned Honey Has Lost 7 Million Users Amid Creator Lawsuit
There are a few sponsors you can't escape on YouTube, and Honey is one of the most controversial. Bought out by PayPal in 2020 for $4 billion, the coupon extension has found itself in a hive of trouble over the last few years. YouTuber MegaLag investigated the app in 2024 and found that it was quietly transferring sales commissions from content creators to PayPal, and it was later claimed that Honey allegedly scraped private, single-use promo codes directly from individual shoppers.
In response, Google updated its Chrome Web Store policies to stop link manipulation, mandating that extensions must disclose affiliate re-attribution, while Rakuten Advertising introduced a new system to prevent extensions from overwriting affiliate tracking. Amid these systematic developer changes, content creators not only warned their audiences away from Honey (including Markiplier, who noted the app was suspicious long before the investigation), but a joint lawsuit led by LegalEagle was filed against PayPal.
As reported by MegaLag, thanks to this wasp's nest of controversy, Honey has lost over seven million users, dropping from 20 million on the Chrome Web Store to 12 million. It's a significant dip, but on top of that, US District Judge Beth Labson Freeman denied Honey's motion to dismiss the second amended complaint in what MegaLag called "a huge win for content creators and a massive blow to PayPal."
Honey's Number Of Coupon Codes Has Almost Halved
While this doesn't mean that PayPal has been found liable yet, it does mean that the plaintiffs can seek internal communications and testimony from employees, progressing into the discovery phase. And to make matters even worse for Honey, compounding the lawsuit and millions of users uninstalling the extension, its collection of coupon codes has shrunk from 90,000 to 50,000, with 10,000 of the remaining codes being expired. Capped off by merchant partnerships falling from 35,000 to 28,000.
Honey's entire selling point was simple: saving money. Through its YouTube sponsorships, it promised to an audience of millions that it could shave off a few dollars whenever you go shopping by scraping the internet and finding the best coupon codes. But with the extension now embroiled in years-long controversy that shows no sign of slowing down, that $4 billion PayPal paid has proven to be anything but a good deal.