Honey has lost 7 million users since a YouTuber exposed how it worked
PayPal’s Honey extension has shed more than 7 million users and 7,000 merchant partners since MegaLag’s viral investigation accused it of hijacking creators’ commissions. Now a creator class-action against PayPal has survived dismissal and is heading to discovery.
The coupon extension Honey spent years as an inescapable YouTube sponsor. Since a single investigation took it apart, more than seven million people have uninstalled it.
That’s the headline from a new follow-up by tech YouTuber MegaLag, published August 11 and titled “Honey Gets Terminated as Lawsuits Proceed.”
According to his data, PayPal-owned Honey has dropped from about 20 million Chrome users to roughly 13 million, and around 7,000 merchants have cut ties. Its stock of coupon codes has shrunk from 90,000 to 50,000, with thousands of the survivors already expired.
The user exodus is only half of what’s gone wrong for Honey.
What the original investigation found
To understand the fallout, you have to go back to the accusation that started it.
MegaLag’s December 2024 investigation alleged that Honey did two things it shouldn’t.
First, it claimed the extension replaced content creators’ affiliate tracking with its own at checkout, so Honey collected the commission on a sale a creator had actually driven.
Second, it questioned whether Honey reliably surfaced the best available discount codes, or quietly withheld them. PayPal disputed the allegations, saying Honey followed standard industry practices like last-click attribution.
The video went massively viral, in part because Honey was a sponsor for enormous creators like MrBeast and MKBHD, meaning a huge slice of YouTube had effectively been promoting the tool the investigation targeted.
The legal front is where it gets worse
Losing users is one thing. A federal judge letting a lawsuit proceed is another.
A consolidated class-action from content creators against PayPal cleared a major hurdle when US District Judge Beth Labson Freeman declined to dismiss it, every claim survived, sending the case into discovery.
That’s not a finding that PayPal did anything wrong. It means the creators’ allegations, taken as true, state claims a court will actually hear, and it opens the door to internal PayPal communications and employee testimony.
MegaLag called the ruling “a huge win for content creators and a massive blow to PayPal.”
The affiliate networks had already moved: Rakuten, Impact.com, and Awin all took action against Honey over the past year, though Rakuten later reinstated it after adding safeguards against exactly the kind of tracking-overwrite Honey was accused of.
What it means
This is a rare case of an internet exposé producing measurable, lasting consequences.
Most viral “this company is scamming you” videos generate a week of outrage and then fade. This one moved numbers, seven million uninstalls, thousands of dropped merchants, a surviving federal lawsuit, and forced structural changes at Google’s Chrome Web Store and across the affiliate industry.
PayPal’s position is that the disputed behavior affected a tiny fraction of traffic and has been fixed. The lawsuit will test that.
For everyone else, it’s a clean example of leverage most people didn’t know they had. A tool sitting quietly in millions of browsers turned out to be one well-researched video away from losing a third of its users and a chunk of its legal footing. Honey is still running. It’s just running a lot smaller, and now it has to explain itself in court.
Article compiled and edited by Derek Gibbs (entertainment editor) and the Clownfish TV newsroom.
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Hat Tips:
Dexerto (August 2026), verified for the 7 million-plus users lost, the 7,000 merchant partners dropped, the coupon codes falling from 90,000 to 50,000, the Rakuten/Impact.com/Awin actions and Rakuten reinstatement, and the December 2024 original investigation
The Gamer (August 2026), verified for the 20-million-to-13-million Chrome user drop, Judge Beth Labson Freeman denying the motion to dismiss, the discovery-phase implications, the MrBeast/MKBHD/LegalEagle context, and Markiplier’s earlier warnings
PPC Land (August 2026), verified for the June 22 2026 ruling with every claim surviving, the June 4 hearing details, the affiliate-identifier-value argument, and the roughly-one-fifth merchant-roster shrinkage
UNILAD Tech and Fortune (2024-2026), verified for PayPal’s “less than 0.1% of traffic / code fixed” statement, the last-click-attribution defense, the $4 billion 2020 acquisition, and MegaLag’s “Honey Gets Terminated” August 11 follow-up