It has a malicious DRM that actives when the player tries to hack/cheat the fangame.
This malicious DRM could give the creator of this fangame access to information on your computer.
Things like your passwords, credit card information, etc.
Unfortunately, if you have downloaded and played this fangame, the creator has your IP and possibly more of your information.
I advise everyone to not download this fangame or else some of your information could be in the hands of others.
Please read this for more info.
https://www.reddit.com/r/SonicTheHedgehog/comments/7iynxv/psa_fangame_sonic_gather_battle_has_a_malicious/
Here's a video explaining it a bit.
https://youtu.be/6acvaLPmp-c
Here's a video showing off the effects of it in action.
https://youtu.be/s_5IS7nWKas
It seems that the reason for making his game like this is.. because the creator doesn't want people to take his sprites.
You forgot to mention the part where once the DRM starts, you have to personally talk to him that you're not a hacker or a thief, and THEN he'll whitelist your PC if he wants to.
Who does he thinks he is?
Who does he thinks he is?