The fallout from the collapse of FTX has reportedly now extended to celebrities who appeared in the cryptocurrency exchange’s commercials.
Tom Brady, Gisele Bündchen, Stephen Curry, Larry David and other celebrity endorsers — as well as former FTX CEO Sam Bankman-Fried — have been named in a lawsuit filed in U.S. District Court in Miami, the Washington Post reported Wednesday (Nov. 16).
The proposed class action accuses them of promoting unregistered securities and violating Florida’s Securities and Investor Protection Act and the Deceptive and Unfair Trade Practices Act, according to the report.
The downfall of FTX has triggered a worldwide regulatory investigation and could leave the company dealing with more than 1 million creditors.
That’s according to a court filing Monday (Nov. 14) in FTX’s Chapter 11 bankruptcy case before a federal court in Delaware, which says FTX and its associated companies are facing more than 100,000 creditors and that “[in] fact, there could be more than one million creditors.”
As PYMNTS reported in July in an article about crypto’s celebrity endorsements, FTX gave Brady and Bündchen equity stake — and $20 million — to become global ambassadors for the then-fast-growing crypto exchange.
Brady and Bündchen’s “Are You In?” commercials for FTX that saw Brady calling regular, working class “friends” ended with the tagline “FTX: The most trusted way to buy and sell ____.” The ad cycled through five potential investments: Bitcoin, ethereum, dogecoin, non-fungible tokens (NFTs) and crypto.
There has long been pushback from crypto’s skeptics, who said actors, musicians and athletes shouldn’t be using their fame to push risky investments.
“This is real money that people are investing,” Giovanni Compiani, a University of Chicago marketing professor, told the New York Times in May. “Those who promote it should be more upfront about the potential downsides.”
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