Someone on Reddit already summed things up in a TL;DR sort of format so I'm going to link it right here
But for anyone having trouble with the link or does want to hear a "long version" anyway here goes.
So recently SrPelo made an animation poking fun at Story Time Animations:
Pelo mentions the whole thing is more of a lighthearted jab and really isn't meant to be seen as malicious as he doesn't really have any issues with any STA personally, he just admits that these types of videos just aren't to his liking.
Arin Hanson/Egoraptor of Game Grumps fame however responded to the animation saying he felt it was mean spirited, in particular saying he felt it said something that a bunch of the positive praise Pelo was getting was coming mainly from "old school Newgrounds types" rather than any of the STA people he parodied (playing a little bit of Devil's Advocate here and say I can at least see why Arin would say that given Pelo's video has a scene where it's implied the cops who come to attack the STA people were called in by Newgrounds animators, which someone could interpret as a "the only good/true animators out there are ones who started on Newgrounds" kind of statement even if that wasn't Pelo's intention).
Arin got called out by animators like Spazkid and OneyNG for his comments, saying he was being overly sensitive and didn't like how his calling out of "old school Newgrounds types" implied he was trying to throw the community he was once a big part of under the bus by implying they're bullies. This did prompt one of the STA people who Pelo parodied in his video, Shugrr, to actually respond to Arin saying she agreed he was being too "thin skinned" and that he really isn't someone who should be speaking on behalf of the STA community.
This also caused a situation where Arin began trending on Twitter as people angry at Arin's comments began to start digging up stuff from Arin's past showing him being mean spirited, causing a case of "cancel culture outrage."
Arin later made an apology on his Twitter for his past saying he's done and said stupid things but it was long ago and doesn't reflect who he is now, but some people like Spazkid found his apology disingenuous, and Justin Whang of the channel "Whang" also wondered why Arin didn't mention Pelo in the apology.
Pelo confirmed via a reply to someone else on twitter that he and Arin actually spoke in private not long after this whole shitstorm started and things between the two of them are cool now with no bad blood whatsoever, so it's likely Arin didn't mention Pelo in his apology because he already spoke with Pelo directly and wanted to stick more to the stuff that dealt with just him personally.
The relevant links are in the above Reddit thread, but I'll post 'em here too:
Arin calling the video mean spirited
Pelo saying that he and Arin talked in private and things are cool between them