Cryptocurrency Market Collapse | Celebrities are more discreet

In the latest advertisement from the virtual currency exchange site Crypto.com, titled Courage is a Processstar basketball player Joel Embiid walks into Philadelphia while Bill Self, his former college coach, narrates.

Posted at 9:00 am

Tiffany Hsu
The New York Times

“Even though our path didn’t make sense at all, we continued,” Self said in the ad, which debuted on May 6. “We continued, until our path was what they wanted to tread. »

What the ad doesn’t say: The cryptocurrency market is in the midst of a meltdown. Consumers beware.

The enthusiasm of Hollywood celebrities and top athletes for crypto has risen in recent years. On social media, in interviews and even in music videos, they presented virtual money as a world with its own culture and philosophy, more open than traditional finance and offering the opportunity to earn big silver.

The Super Bowl was in fact dubbed this year’s Crypto Bowl because of the large number of commercials – worth up to $ 7 million in 30 seconds – showcasing the industry, including some featuring celebrities.

But after investors watched as hundreds of billions of dollars were lost in this month’s sharp drop in prices, these popular promoters are now faced with growing criticism that they helped push admirers weak into investing. in cryptocurrencies without highlighting the risks. Unlike clothes, snacks or many other products sold by stars, the cryptocurrency market is volatile and full of scams.


PHOTO DADO RUVIC, REUTERS ARCHIVES

Despite the craze for cryptocurrency over the past year, the market is in the midst of a global collapse… no fault of their respective spokespersons.

“It’s real money that people invest in,” said Giovanni Compiani, an assistant professor of marketing at the University of Chicago, whose research has shown that younger, lower -income investors tend to be too optimistic about the crypto trajectory. “Those who promote it should be more upfront about the potential downsides.»

Silence on the radio …

So far, celebrities promoting crypto have remained silent on whether they have any doubts about their promotions.

Crypto.com declined to make Joel Embiid available for comment in an interview on his partnership with the company. Matt Damon, who compared the advent of virtual money in aviation development and spaceflight to a criticized but widely circulated Crypto.com ad last year, did not respond to interview requests. . There was also no response from basketball star LeBron James, who appeared in the company’s Super Bowl ad this year.


PHOTO OF YARA NARDI, REUTERS ARCHIVES

Matt Damon

Oscar winner Reese Witherspoon, who said online in December that “crypto is here to stay,” did not respond to a request for comment. Nor was Gwyneth Paltrow, another Oscar winner, who lent her name to a contest offering bitcoins as prizes late last year.

Paris Hilton, who has nearly 17 million Twitter followers watching her coo about her two dogs named Crypto and Ether, did not respond to a request for comment. The same goes for some other famous “cryptopromoters”, such as Mila Kunis, Aaron Rodgers and Tom Brady. A representative for Naomi Osaka, the tennis star who became ambassador for cryptocurrency exchange FTX this year, wrote in an email that “unfortunately she is abroad and unavailable.”

“We have no idea how cryptocurrencies work…”

In FTX’s Super Bowl commercial, comedian Larry David despised important inventions like the wheel and bulb before dismissing crypto. The ad invited viewers, winking at the same time: “Don’t be like Larry. »

Jeff Schaffer, director of the Super Bowl commercial, said in an email that he and David had no comment on the market crash.

“Unfortunately, I don’t think we can add anything, because we have no idea how cryptocurrencies work (even after explaining it to us many times), we don’t own it and we don’t follow its market,” he said. he said.

We just had in mind to make a fun commercial!

Jeff Schaffer, director of an FTX cryptocurrency ad

The responsibility of the stars

The instability of cryptocurrencies reveals a major mistake in celebrity marketing: the support of a famous person will be remembered – actor John Houseman’s advertisements for investment firm Smith Barney a few decades ago disappeared to the Madison Avenue legend-but that doesn’t make the product being advertised inherently worth a try.

“That’s what they do-they’re celebrities, they’re offered money to promote something promising,” said Beth Egan, associate professor of advertising at Syracuse University. .

But it’s not without risk, M added.ako Egan. If the cryptocurrency industry continues to thrive – or if it regains its high status – promoters can be commended. But if the fall continues, their reputation could suffer.

“If I were Matt Damon or Reese Witherspoon, I would question my willingness to accept this type of contract,” he said.

This article was originally published on The New York Times.

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