Whether you think cryptocurrency and non-fungible tokens (NFTs) are the future of digital banking or a Ponzi scheme for the 21st century, you cannot deny that, at the very least, the two are both wildly volatile.
Which has always made it so surprising that celebrities from all avenues of entertainment so willingly threw their unvarnished support behind all sorts of crypto-related ventures.
Oh, wait. It’s not surprising at all since those same crypto companies likely paid them oodles of cash to hock their non-fungible goods, the actual quality of those goods be damned.
And that notion is at the crux of an all-encompassing lawsuit aimed at some A-list heavy hitters — the likes of Madonna, Jimmy Fallon, Serena Williams, Steph Curry, Tom Brady, and more.
According to Deadline, a new class action lawsuit filed in federal court is targeting those famous faces over pushing Bored Ape Yacht Club NFTs for “hidden payoffs.”
Even if you’re not familiar with its name, surely you’ve seen these kinds of NFTs (read: images) bandied about:
The lawsuit, which was filed in US District Court in California on Thursday by Adonis Real and Adam Titcher, states that the “defendants’ promotional campaign was wildly successful, generating billions of dollars in sales and re-sales.”
The idea of people spending “billions of dollars” on overhyped JPEG files is… depressing, to say the least.
“The manufactured celebrity endorsements and misleading promotions regarding the launch of an entire [Bored Ape Yacht Club or BAYC] ecosystem (the so-called Otherside metaverse) were able to artificially increase the interest in and price of the BAYC NFTs during the Relevant Period, causing investors to purchase these losing investments at drastically inflated prices.”
The lawsuit accuses the various defendants of using their respective platforms to publicly praise the BAYC NFTs and claiming to be customers themselves.
“The truth is that the Company’s entire business model relies on using insidious marketing and promotional activities from A-list celebrities that are highly compensated (without disclosing such), to increase demand of the Yuga securities by convincing potential retail investors that the price of these digital assets would appreciate,” the lawsuit claims.
Additionally, the lawsuit claims that the celebrities “engaged in a plan, scheme, conspiracy, and course of conduct pursuant to which they knowingly or recklessly engaged in acts, transactions, practices, and courses of business that operated as a fraud and deceit upon Plaintiffs and the other members of the Class.”
Put simply, the lawsuit is making the legal point that celebrities were promoting these NFTs without also disclosing how much they were being paid to do so.
“In truth, the Executive Defendants and Oseary used their connections to MoonPay and its service as a covert way to compensate the Promoter Defendants for their promotions of the BAYC NFTs without disclosing it to unsuspecting investors,” the lawsuit adds.
Celebrity music manager Guy Oseary, mentioned above, is tabbed as the mastermind of this entire scheme.
This lawsuit is the latest woe to befall the crypto economy.
In late November, the Department of Justice charged 21 people for using cryptocurrency to money launder. Given the unregulated nature of cryptocurrency, money laundering is a constant concern with it.
Much more significantly, cryptocurrency exchange company FTX has made all sorts of negative headlines recently — from going bankrupt to having former CEO Sam Bankman-Fried exposed as a huckster who stole from the poor and gave to the mega-rich Democrats.
A brief stab at advertising may prove to be quite costly for all of these celebrities involved.
And while they surely have enough money to withstand such a lawsuit (if they are even found guilty), it’s still a bad look.
Hopefully, those celebrities are aware that monkey JPEG files won’t be accepted should be found guilty. It’s going to cost them real money.