The End of “Crypto Ponzi Schemes”?
- Celebrities jump on the bandwagon to promote various crypto products, luring thousands of followers.
- Little is known about the basic knowledge the celebrities possess about crypto and the products they promote.
The crypto ecosystem is growing faster than ever. Celebrities are jumping on the bandwagon promoting exchanges and coins. Paris Hilton, Charli D’Amelio, Snoop Dogg, and Shaq are all going all in crypto, dropping NFTs, promoting and collaborating with different exchanges to extend crypto to the masses.
In many cases, it’s a little different than a Ponzi scheme. These influencers are allowed into a project at preferential rates. They then cash in after convincing their audiences to buy into projects they don’t fully understand.
Do you think celebrity promotions are legit?
During the NBA playoffs, a commercial for the cryptocurrency-trading platform FTX aired. It showed Steph Curry going through a wacky day. Narrator, Shaquille O'Neal, explains that Curry understands all there is to know about cryptocurrency.
Curry, irritated, continually denies it. Curry ultimately says into the camera, holding up the FTX app on his phone, "I'm not an expert, and I don't need to be. I have everything I need to purchase, sell, and trade cryptocurrency safely with FTX."
That’s quite the way to promote a cryptocurrency exchange, right? The advertisements should receive credit for the honesty of Curry.
The new video emphasizes something that should have been evident to everyone paying attention: the innumerable celebrities who have jumped on the crypto (and NFT) bandwagon almost surely have no idea what they're selling.
Corporate sponsorships are inherently transactional, but this goes beyond that. Everyone understands that athletes appear in ads because they are paid to do so, not because they use the product.
Late last year, the crypto advertising blitz began in earnest, growing in tandem with the price of digital assets. Several big-budget ads from the business were featured during the Super Bowl.
Commercials missed out on mentioning crypto's real benefits. Instead, they aim to create FOMO (fear of missing out) by implying that viewers who don't buy in now may come to regret it later.
These FOMO commercials at least gave consumers the option of learning more about cryptocurrency before investing. That illusion is dropped in the Curry advertisement.
To be fair, there is a distinction to be made between not knowing something and being ignorant about it. However, the advertisement is clearly aimed at folks who have been hesitant to trade cryptocurrency because they do not understand it.
The message appears to be, “don’t worry if you don’t know about crypto; neither does Steph.”
The crypto sector's expansion has produced a new generation of millionaires and billionaires, some of whom have set their sites on politics. According to the Washington Post, Crypto investors and executives are spending millions in US elections to elect lawmakers who would support the industry's desired laws.
Bankman-Fried, the CEO of FTX, is reported to be worth $24 billion at the age of 30.
He’s been expanding his DC footprint and has pledged to give practically all of his money away to policies he supports.
At the time of writing, who Bankman-Fried is supporting is varied, but it will be interesting to see how his donations - and those of other wealthy crypto figures - plays out long term.
If FTX’s new approach of more honest advertising is the new benchmark, it might be a positive next few years for crypto.
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