2008 called, and it wants its originality back.

The game is called Rivals of Aether. It's kinda like Smash, but with Steam Workshop.
The character here is Unregistered Hypercam 2, a character made by Dr. %NaN% in celibration of the Youtuber SilvaGunner.
Character page and immage source can be found here (https://steamcommunity.com/sharedfiles/filedetails/?id=2606997278).