19 celebrities called out by consumer watchdog group for shilling NFTs

August 16, 2022 Coin Telegraph

Consumer watchdog group Truth in Advertising says celebrities promoting non-fungible tokens (NFTs) on their social media channels is an area "rife with deception."

Consumer watchdog group Truth in Advertising (TINA.org) has called out 19 celebrities for allegedly promoting non-fungible tokens (NFTs) without disclosing their connection to the projects.

The not-for-profit consumer advocacy organization said on their website they investigated "celebrities who promote non-fungible tokens (NFTs) on their social media channels", finding that "it is an area rife with deception."

Among the star-studded list are sports stars Floyd Mayweather and Tom Brady, music icons Eminem and Snoop Dog, and several actresses, including Gwyneth Paltrow, all of whom have been sent letters urging them to immediately disclose any material connections they have to NFT companies or brands they have promoted, stating:

"The promoter often fails to disclose material connection to the endorsed NFT company."

NFTs are digital certificates stored on the blockchain proving ownership of a digital or physical asset, often an artwork, with many high-profile projects often attracting celebrity endorsement and promotion.

While no real legal penalty has been attached, TINA.org noted that it sent letters to the celebrities involved on Aug. 8 outlining their grievances and advising them of the potentially harmful effect shilling NFTs can have on the public.

One of the group's primary concerns outlined in the letters is that the possible financial risks associated with investing in such speculative digital assets are not being disclosed.

TINA.org previously sent letters to Justin Bieber and Reese Witherspoon's legal teams on June 10 for promoting NFTs on their social media accounts without disclosing their connection to the projects.

Bieber's legal team responded on July 1, denying any wrongdoing but stating the posts would be updated.

While Witherspoon's legal team contacted TINA.org on July 20, claiming the actress is not receiving any material benefits from promoting NFTs.

Shilling could violate FTC guidelines

In a blog post on their website, TINA.org wrote that the previously mentioned celebrities could be violating the Federal Trade Commission (FTC) rules regarding the Use of Endorsements and Testimonials in Advertising and the requirements for influencers.

The advocacy group links to the FTC website which outlines that influencers must disclose any material connections to brands they are endorsing, and make the disclosures clear, unambiguous, conspicuous, and within the endorsement.

So far, there has not been a publicized case of celebrities facing legal penalties for shilling NFTs or crypto.

Though there are several ongoing class action suits, most famously against Elon Musk for his endorsement of Dogecoin, and Mark Cuban for promoting Voyager crypto products.

A handful of other celebrities like Matt Damon caused a significant stir when he appeared in an ad promoting crypto products, which saw the actor relentlessly mocked and ridiculed for his involvement.

Don't listen to celebs: SEC

In 2017, the U.S. Securities and Exchange Commission (SEC) warned investors about celebrity-backed initial coin offerings in a post on their website.

"Investors should note that celebrity endorsements may appear unbiased, but instead may be part of a paid promotion."

"Celebrities who endorse an investment often do not have sufficient expertise to ensure that the investment is appropriate and in compliance with federal securities laws."

According to the SEC, celebrities and influencers using social media to encourage their followers to purchase stocks or other investments could be unlawful if they do not disclose the nature, source, and amount of any compensation paid, directly or indirectly.

Nifty News: Mayweather returns to crypto ring after legal KO… Reef gets NFTs

March 24, 2022 Coin Telegraph

Coin Telegraph

Floyd Mayweather’s latest bout with the crypto space will see him enter the Metaverse with a new NFT collection.

Legendary boxing champion Floyd Mayweather is taking another jab at the crypto space by launching a new NFT and Metaverse project called the Mayweverse.

The nonfungible tokens (NFT) will feature the likeness of Mayweather himself and provide various utilities and prizes for holders depending on the rarity of the item. Little more is known about the project at the time of writing other than that the Metaverse will contain a boxing gym.

After many months of hard work
I’m launching my new NFT Project @mayweverse⁰
The collection will have 5,000 NFTs (5 different NFTs cards of 1,000 each).

Each card has a different rarity, utilities & prizes.

More information on the roadmap will be announced soon.

Stay Tuned pic.twitter.com/SxZ916p0HP
— Floyd Mayweather (@FloydMayweather) March 21, 2022

The launch date and prices is yet been determined, but the hype for the project is growing rapidly. The Discord channel dedicated to the project already has over 5,000 members.

Mayweather’s involvement in this new NFT project is notable considering his sub-par record with crypto projects in the past. Mayweather promoted a high-profile crypto scam called Centra Tech which defrauded investors out of over $25 million in 2018. By 2019, Mayweather and co-promoter DJ Khaled were forced to pay $600,000 and $150,000 respectively for their parts in marketing the project.

Twitter personality Coffeezilla claimed that Mayweather is now “frantically deleting evidence of his last NFT scam,” in order to appear to be in good faith for the Mayweverse launch. Other projects he has promoted include Floyd NFT, Bored Bunny, and Bored BAD Bunny.

Floyd Mayweather is frantically deleting evidence of his last NFT scam.He's getting roasted by the investors. https://t.co/HXUzCWi6sW pic.twitter.com/AQ92nxIhtz
— Coffeezilla (@coffeebreak_YT) March 22, 2022

Own a piece of the Great Barrier Reef

A marine biologist is looking to spark new conservation efforts for Australia’s Great Barrier Reef by re-mapping the world’s largest coral reef system and selling the results as NFTs one hectare at a time.

Dr. Brett Kettle is working with ReeFi DAO to digitally map the entire Great Barrier Reef off the northwest coast of Australia and give people around the world a chance to see it with their own eyes. Dr. Kettle believes that access to one of the great natural wonders of the world will inspire environmental preservation efforts from owners of the NFTs.

Each NFT will be “an actual three-dimensional photo-realistic model,” Dr. Kettle told Australian national broadcaster ABC. He believes that NFT owners will both be able to experience something they may not otherwise have a chance to, and help the reef’s health. The reef is suffering due to climate change and ocean acidification according to climate researchers at climatehotmap.com.

Collectors will be able to act as proxy stewards of the NFT reef plot they own.

"You might be sitting in an attic in upstate New York with no chance of seeing the Great Barrier Reef, but you can pull down your service provider and choose someone to remove [crown of thorns] starfish from your piece of reef."

Australia’s Qantas Airlines to drop NFTs

Australia’s biggest airline will drop a series of NFTs as memorabilia commemorating the airline’s 102-year history in aviation.

The airline announced the drop on Mar. 22 on its website and stated that the collection would not just be a simple piece of history to hold. The first buyers of the NFTs will earn frequent flyer points called Qantas Points and the airline said it has “more exciting future benefits for Qantas NFT holders underway.”

The NFTs are due to drop by mid-year.

Krafton and Solana partner

South Korean gaming company Krafton has sealed a partnership with Layer-1 blockchain project Solana (SOL) to develop and operate blockchain-based games using NFTs.

Web3 Lead at Krafton Hyungchul Park said in the company’s official statement that he expects the partnership will allow Krafton to “acquire the insight needed to accelerate its investment in and output of blockchain-based experiences.”

Krafton is the company behind the popular PUBG: Battlegrounds game. It is not yet clear what direction the company will take with the partnership and whether it will tokenize in-game assets from its popular battle royale game.

KRAFTON, one of South Korea's most valuable gaming companies, announced the signing of a business agreement with Solana Labs to support the design and marketing of blockchain-based games and services. https://t.co/vJkQuDahgT
— Wu Blockchain (@WuBlockchain) March 24, 2022

Krafton saw its biggest profits ever in 2021 and raked in more than $1.5 billion thanks to the success from its flagship game title.

Other Nifty News

Video game retailer Gamestop has launched an NFT marketplace on the Loopring Layer-2 solution. The beta version of the marketplace is now live. Loopring’s Head of Growth says the marketplace will allow collectors to mint and trade NFTs in a “fast, cheap, and secure” way.

NFT marketplace Veve experienced a security breach on Mar. 22 that saw millions of its in-app tokens known as gems being stolen. The marketplace was shut down while an investigation took place.

Almost half of crypto owners turn to celebs like Kim Kardashian for advice: Survey

September 23, 2021 Coin Telegraph

Celebrities

A surprisingly large proportion of crypto owners report they would purchase a crypo asset because it is endorsed by a celebrity or influencer.

A new survey has revealed bleak insights into the apparent willingness of retail investors to follow digital asset advice from the social media accounts of celebrities and influencers.

According to a Morning Consultant survey of 2,200 U.S. adults, 45% of crypto-holding respondents indicated they would be likely to seek exposure to a digital asset if it is endorsed by a celebrity, compared to just 20% of participants overall.

There were some more promising results, with three-quarters of crypto investors indicating they were likely to invest based on a family member or friend’s recommendation while 81% would invest in response to advice from a financial advisor.

Almost 20% of all respondents and nearly one third of crypto owners said they were aware of a post published to Kim Kardashian’s Instagram account spruiking the ERC-20 token Ethereum Max (EMAX) in early June. An astonishing 19% of respondents who saw the Instagram ad admitted to having invested in Ethereum Max afterward — however they comprising just 3.8% of the overall sample.

The post and project have been embroiled in controversy ever since. The price of EMAX saw meteoric growth after being announced on May 26 as “the exclusive cryptocurrency accepted for online ticket purchasing” for the cash-grab boxing match between undefeated boxer Floyd Mayweather and YouTuber Logan Paul on June 6.

While EMAX had traded for as little as $0.00000000073 (nine zeros) prior to the announcement, news of its affiliation with the boxing event saw prices skyrocket above $0.00000085 (six zeros) by June 1 — a gain exceeding 116,000% in just one week.

After Ethereum Max then shed more than 99% of its value in under two weeks, Kardashian published the ad on June 13 to her 250 million followers that highlighted that 50% of EMAX tokens held by the project’s admin wallet had been burned.

While the token was trading as low as $0.0000000076 (seven zeros) before the Instragram post went live according to CoinMarketCap, EMAX rallied to $0.000000235 (six zeros) by June 14 — a 3,000% gain in less than two days.

EMAX has consistently trended downwards since mid-June, with the token last trading hands for $0.000000021(seven zeros) — a 91% drawdown from the local highs that followed Kim Kardashian’s Instagram endorsement.

The incident did not go unnoticed by financial regulators, with the head of the United Kingdom’s Financial Conduct Authority, Charles Randell, describing the Kardashian’s Instagram post as possibly the single “financial promotion with the biggest audience reach in history.” He added:

“I can't say whether this particular token [Ethereum Max] is a scam. But social media influencers are routinely paid by scammers to help them pump and dump new tokens on the back of pure speculation. Some influencers promote coins that turn out simply not to exist at all.”

Kim Kardashian is not the first celebrity to draw the ire of financial watchdogs for promoting crypto assets to their social media followers, and unlikely to be the last too.

In 2018, the U.S. Securities and Exchange Commission charged Floyd Mayweather and musician DJ Khaled unlawfully promoting the Centra initial coin offering (ICO) the previous year.

While the SEC has warned celebrities that they must disclose paid promotions for ICOs on social media, many celebrities are now spruiking their own nonfungible tokens amid the NFT boom.

Floyd Mayweather