YouTuber baits MMA fighter into secretly shilling fake NFTs for $1K

February 4, 2023 Coin Telegraph

YouTuber baits MMA fighter into secretly shilling fake NFTs for K

Coffeezilla, a YouTuber and crypto investigator, revealed that American mixed martial artist Dillon Danis promoted a fake NFT project without disclosing that he received $1,000 for the advertisement.

While the support from numerous A-list celebrities expedited the nonfungible token (NFT) boom of 2021 and 2022, a handful ended up promoting unvetted projects to fans purely for personal monetary benefits. However, the misconduct retains its popularity in 2023 as markets embark on a recovery.

Coffeezilla, a YouTuber and crypto investigator, revealed that American mixed martial artist Dillon Danis promoted a fake NFT project without disclosing that he received $1,000 for the advertisement.

We just tricked Dillon Danis into promoting a fake NFT project. We paid him $1,000 to post, he didn't disclose it was an #AD, and posted copy that literally spells out S.C.A.M. pic.twitter.com/SVo2SCoN9q
— Coffeezilla (@coffeebreak_YT) February 3, 2023

In the promotion, Danis tweeted out a digital image along with a website URL, which according to Coffeezilla, “literally spells out S.C.A.M.” A further investigation from Cointelegraph shows that the website URL was newly created on Feb. 1, 2023, an important clue to check when checking the credibility of new projects.

Moreover, the website FAQ clearly mentions that no investors can get hold of the “Sourz” NFTs, a crucial piece of information overlooked by the MMA fighter.

*SourzNFT FAQ highlighting that no users can get the NFTs. Source: sourznft.com (CoffeeZilla)*

A similar incident involving Kim Kardashian was flagged in June 2021 by the Securities and Exchange Commission (SEC) as she promoted EthereumMax (EMAX) crypto token to her 330 million Instagram followers. According to the SEC, Kardashian violated the anti-touting provision of the Securities Act by failing to disclose the $250,000 she had received for the promotion.

However, Coffeezilla ensured that the users who fell for the scam NFT project were notified immediately. When users click the “Mint Sourz” button (as shown in the above screenshot), they are redirected to a website that cautions against a possible scam.

*A webpage showcasing crypto projects previously promoted by MMA fighter Dillon Danis. Source: sourznft.com (CoffeeZilla)*

While Coffeezilla plans to share more information on this through a follow-up video, the incident comes as a strong reminder for influencers and investors to conduct thorough research (DYOR) before promoting or investing in a project.

Japanese authorities have started exploring blockchain use cases to solve numerous technological issues. Fumio Kishida, the prime minister of Japan, recently spoke about the “various possibilities for using Web3” in the country.

*Prime Minister Fumio Kishida addressing the Budget Committee on Feb. 1. Source: YouTube*

“If you consider DAOs, people who are interested in the same social issues can form a new community,” said Kishida. “NFTs can also be used to diversify the income of creators and maintain highly loyal fans.”

Spanish Securities Regulator CNMV Warns About Crypto Investments; Calls for Caution After FTX Downfall

November 29, 2022 Bitcoin.com

FTX meltdown triggers FINRA into probing crypto comms

November 18, 2022 Coin Telegraph

The examination comes in the wake of the FTX debacle, a crypto exchange found to be mismanaging customers’ funds by simply lying about their operations.

The Financial Industry Regulatory Authority (FINRA), the American self-regulatory organization, has launched an examination into the firm’s retail communications concerning crypto products and services offered by them.

The regulatory body, in an official notice, announced that it is launching a targeted exam on firms on how they handled retail communications between July 1 and the end of September. The decision to examine crypto-related retail communications comes in the wake of the collapse of the FTX crypto exchange.

Any written (including electronic) message that is issued or made available to more than 25 retail investors within any 30-day period is referred to as a “retail communication” according to FINRA. It also applies to video, social media, mobile apps and websites in addition to writing communications.

In its exam notice, FINRA asked firms to provide additional information for each individual communication, such as the date it was first made public, whether it was filed with FINRA’s advertising regulation department, whether a principal at the firm approved the communication and identifying the crypto assets or services mentioned in the communication.

In addition to any relevant compliance rules or materials, FINRA has requested that firms submit written supervisory procedures for the “examination, approval, record-keeping and dissemination” of the communications. It also requested information on any contracts made with affiliates on the production or distribution of the messages, as well as any knowledge such affiliates might have regarding the target audience.

The probe began on Nov. 14 with an aim to investigate whether any of the retail crypto products or services were falsely advertised. At the peak of the crypto bull run, crypto advertisements became the flavor of many brands and celebrities. Crypto ads ruled the Super Bowl 2022 as well, with FTX being one of the most talked about ads at the time.

The flood of advertisements became a big concern for regulators given the majority of these advertisements didn’t adhere to any advertisement standards and often hid the risks associated with crypto investments while glorifying the high returns.

Many celebrities like Tom Brady, Larry David and Steph Curry, who were brand ambassadors for the FTX crypto exchange, are facing a class-action lawsuit. The lawsuit alleged that celebrities advertised FTX’s fraudulent scheme that was designed to take advantage of unsophisticated investors from across the country.

At the start of the year, authorities in the United Kingdom, Singapore and Spain tightened the requirements around crypto firms’ marketing messaging and customer recruitment practices. Many other countries and global brands have also imposed restrictions on crypto advertisements amid market turmoil.

Amendment to UK financial services bill provides regulation for crypto activities

October 21, 2022 Coin Telegraph

The bill addressed stablecoin regulation from the start; now the Financial Conduct Authority will be empowered to regulate activities with crypto assets if the amended bill passes.

An amendment to the Financial Services and Markets Bill now before the United Kingdom's Parliament would extend the law’s powers to regulate financial promotion and other activities to crypto assets. The amendment was written by Member of Parliament and Financial Secretary to the Treasury Andrew Griffith.

The 335-page bill was introduced in July and had its second reading in the House of Commons on Sept. 7. According to the explanatory statement accompanying the amendment, it would:

“[...] clarify that the powers relating to financial promotion and regulated activities can be relied on to regulate cryptoassets and activities relating to cryptoassets.”

The Financial Conduct Authority (FCA), the U.K.'s financial regulator, published a “Dear Chief Executive” letter Aug. 9, which detailed its supervisory strategy over financial firms’ so-called "alternatives portfolio." The letter stated: “We will publish final rules for the promotion of crypto assets once the Treasury formalises legislation to bring these into our remit.”

Most crypto-related businesses in the U.K. are not under the control of the FCA now, though they have the option of applying for registration and will be required to do so next year. The registration process currently looks only at Anti-Money Laundering and Countering the Financing of Terrorism measures and has proven challenging for many applicants.

It was a pleasure to give evidence to the House of Commons Financial Services & Markets Bill Committee today, answering questions from @griffitha @TulipSiddiq and @MartinJDocherty on UK regulatory competitiveness, crypto-assets and stablecoin. More here: https://t.co/J0f1OCtqb5 pic.twitter.com/ZzjCwaPEiD
— Adam Jackson (@Adam_E_Jackson) October 19, 2022

The FCA also took action on the advertising of high-risk financial products in August, and explicitly stated that crypto assets can be risky but the agency was not yet regulating them. The country’s Advertising Standards Authority has been more aggressive in monitoring crypto-related advertising.

Griffith’s predecessor as financial secretary Richard Fuller stated in September that the government was committed to making the U.K. a “hub for crypto technologies.” On Oct. 10, the European Parliament Committee on Economic and Monetary Affairs passed the Markets in Crypto-Assets bill and a full parliamentary vote is expected soon.

Crypto Touted by Kim Kardashian Climbs 124% After SEC Charges, Token Value Dumps the Next Day

October 5, 2022 Bitcoin.com

SEC Charges Socialite Kim Kardashian for Unlawfully Touting Ethereummax

October 3, 2022 Bitcoin.com

Netflix bans crypto commercials on ad-based streaming service: Report

September 5, 2022 Coin Telegraph

Desperate to boost revenues, Netflix announced in July that it would be launching a cheaper subscription tier that features commercials.

Streaming giant Netflix has reportedly banned cryptocurrency-related commercials on its ad-supported subscription tier, which is scheduled to launch in November months ahead of schedule.

Citing local sources, The Sydney Morning Herald reported Monday that Netflix has decided to reject all advertising campaigns related to politics, gambling and cryptocurrency on its new subscription tier. The new tier will also not run ads selling products to children. The same sources indicated that restrictions on pharmaceutical ads were also being considered.

According to Variety, Netflix has moved up the timeline for launching its cheaper ad-supported tier to November to compete with Disney+, which is launching its own ad-based plan on Dec. 8. Initially, Netflix was planning to launch its ad-supported tier at the start of 2023.

Netflix's new subscription tier will go live on Nov. 1 in several countries, including the United States, Canada, United Kingdom, Germany and France, Variety said.

With global subscribers declining in consecutive quarters, Netflix announced in July it would launch a new ad-supported service to boost revenues. In the second quarter, the streaming giant lost 970,000 paid subscribers after losing 200,000 in the first three months of 2022. Faced with slowing revenue growth, Netflix disclosed in June it would cut costs to keep its margins at 20%.

Due to regulatory scrutiny, crypto bans are nothing new for the digital asset industry. In 2018, social media giant Meta (formerly Facebook) banned crypto ads across its platform before reinstating them later in the year. In 2021, Google-parent Alphabet reversed a ban on crypto-related advertisements, allowing exchanges and wallet operators to again promote their services on the search engine.

Dubai issues crypto marketing rules to better protect investors

August 29, 2022 Coin Telegraph

Dubai's new Virtual Asset Regulatory Authority requires more clarity and transparency from industry marketers and promoters in order to protect investors.

Amid Dubai moving forward with a new license program for cryptocurrency service providers, local regulators are introducing additional marketing and advertising rules for the industry.

Dubai’s Virtual Asset Regulatory Authority (VARA), the city’s dedicated crypto regulator, reportedly announced new regulatory guidelines on marketing, advertising and promotions of virtual assets on Aug. 25.

In the rules, the VARA referred to all forms of outreach, communications and advertising, dissemination of information, building awareness, customer engagement, investor solicitation and others, the local news agency Gulf News reported.

The guidelines cover all virtual asset-related communications and entities publishing information on Dubai-based media websites, search platforms as well as online and offline publishing channels that target customers within the Dubai market.

The rules reportedly also require all local virtual asset service providers (VASP), including advertising platforms, to ensure factual accuracy and openly demonstrate any promotional intent to avoid misleading potential customers.

The VARA reportedly noted that the new guidelines relate to Dubai’s crypto-focused Minimal Viable Product (MVP) license, stating:

“These regulations specifically address marketing and communications activities, ahead of operationalizing the MVP licensees so that any mass-market information dissemination, and consumer solicitation are designed to safeguard community interests.”

As previously reported, Sam Bankman-Fried’s FTX crypto exchange was one of the first companies to receive VARA’s MVP license through its local subsidiary FZE in July 2022. The license enabled FZE to operate a VASP in the region fully.

VARA’s guidelines came along with Abu Dhabi’s new plans to launch a strategy for blockchain and virtual assets that aligns with the country’s overall economic strategy. On Aug. 25, the Abu Dhabi Blockchain and Virtual Assets Committee held its first meeting to discuss the strategy.

Established in March 2022, Dubai’s VARA is responsible for licensing and regulating all VASPs in the Emirate’s special development and free zones with the exception of the Dubai International Financial Centre. The regulator is known for its ambitious industry regulation plans, purchasing land in the virtual reality world The Sandbox in May.

Globant Survey: Most Gamers Believe Metaverse Will Change the Gaming Industry Positively

July 18, 2022 Bitcoin.com

Binance takes legal action against fake billboard ads in Turkey

May 9, 2022 Coin Telegraph

Trying to cash in on Binance’s popularity in the country, scammers in Turkey have been found to rent numerous billboards to advertise fake Binance-themed opportunities.

Binance TR, the Turkish arm of crypto exchange Binance, has warned investors in the region of an ongoing scam attempt that targets crypto investors via fake Binance-branded billboards and hoardings.

Turkey is home to a large number of crypto investors that account for over 7% of the total traffic to Binance’s primary platform through a desktop browser, as evidenced by data from Similarweb. Trying to cash in on Binance’s popularity in the country, scammers in Turkey have been found to rent numerous billboards to advertise fake Binance-themed opportunities.

Bir süredir Türkiye’nin farklı bölgelerinde aşağıdaki görsele benzer reklam panoları göze çarpmaktadır.

Aşağıdaki görselin #Binance ile ilgisi yoktur❗️

Dolandırıcılık faaliyeti içinde oldukları açıkça belli olan kişiler hakkında gerekli hukuki süreçler başlatılmıştır.#SAFU pic.twitter.com/znvJDLRP7v
— Binance Türkiye (@Binance_Turkish) May 8, 2022

In the latest warning issued by Binance Turkey, the billboard is shown sporting an advertisement for “Binance Tourist exchange” that has no affiliation with the original Binance, founded by Changpeng “CZ” Zhao. The ad also includes telephone numbers that, when dialed, can connect potential victims to scammers. A rough translation of the warning reads:

“For a while, billboards similar to the image below have been striking in different regions of Turkey [...and] has nothing to do with #Binance!”

Given the ease in tracking down the people responsible for renting out billboards and posting fraudulent advertisements targeted at crypto investors, Binance has revealed its intent to go on the offensive and take necessary legal against the people “who are clearly involved in fraudulent activities.”

Unwary investors who end up contacting the fake contact numbers are usually greeted by the scammer posing as Binance. With the ultimate goal to steal money in the form of crypto assets, scammers have been found to direct investors to create new accounts or share existing seed phrases.

Just last month, on April 15, Binance launched its first 24/7 customer service center in Turkey as it prepares to expand the service worldwide. As Cointelegraph previously reported, Binance set up customer support in Turkey with the primary goal to proactively mitigate fraud cases before it happens.

Investors who suspect being in contact with such scammers are advised to contact Binance’s official customer support through official channels, including the website or mobile application.

Owing to the massive interest in crypto among Turkish investors, the popular crypto exchange Coinbase reportedly planned to increase its footprint in the region by eying a purchase of local crypto exchange BtcTurk for $3.2 billion.

Cointelegraph’s report on the matter reveals that both the crypto exchanges have reportedly already signed a term sheet. However, an official confirmation about the deal is still awaited.

To support the ongoing global expansion drive, Coinbase has also posted a job opening in Turkey for a country director who can “play a key role in supporting major regulatory/policy efforts, and subsequently ensuring that Coinbase operates in full compliance with applicable local regulatory requirements.”

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