Why did many people leave their cryptocurrency holdings with FTX instead of a safer, US-based brokerage like Coinbase or a private wallet? For many people, it was because finance YouTubers told them to. And now that FTX has collapsed and their holdings have disappeared, they want to recover their losses from those YouTubers.
News on that comes from Fortune, which reports that a class action lawsuit is being brought against several YouTubers who promoted FTX. Breitbart adds that the lawsuit “is raising concerns about the morality of the actions take by influencers in promoting their sponsors’ goods and services.”
The lawsuit, filed on March 15, alleged that the YouTube influencers and the influencer agency that set up deals between them and FTX were paid to promote FTX and that they “did not disclose the nature and scope of their sponsorships and/or endorsement deals, payments and compensation, nor conduct adequate (if any) due diligence.”
The lawsuit also alleges that “Evidence has now been uncovered that reveals Influencers played a major role in the FTX disaster and in fact, FTX could not have arisen to such great heights without the massive impact of these Influencers, who hyped the Deceptive FTX Platform for undisclosed payments ranging from tens of thousands of dollars to multimillion-dollar bribes.“
Thus, when FTX failed in November of 2022 and caused about $8 billion in losses, those that listened to those influencers lost a large amount of money, $1 billion, that they now wnt to recover from the YouTubers and influencer agency.
Breitbart, reporting on the lawsuit and which finance YouTubers are being sued for their role in promoting FTX without (allegedly) doing their due diligence, reports that:
The lawsuit claims that the influencers played a “major role” in the FTX scandal and names seven plaintiffs who invested in FTX Yield Bearing Accounts. It also alleges that without their support and “hype,” the cryptocurrency platform would not have reached such heights. It adds that influencers took “undisclosed payments ranging from tens of thousands of dollars to multimillion-dollar bribes.”
YouTubers Graham Stephan, Andrei Jikh, Jaspreet Singh of “Minority Mindset,” Brian Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, and Kevin Paffrath, who has 1.87 million subscribers to his channel “Meet Kevin,” are among the defendants listed in the lawsuit. Creators Agency and its founder Erika Kullberg are also mentioned.
Those YouTubers aren’t the only ones being sued for promoting FTX. CryptoPotato, a cryptocurrency-focused news site, reports that numerous high-profile athletes and teams are as well, saying:
As previously reported by CryptoPotato, National Basketball Association (NBA) champion Shaquille O’Neal and Japanese Tennis athlete Naomi Osaka may be spared from an FTX lawsuit, which accuses sports stars and other celebrities of promoting FTX to investors with little crypto knowledge.
Other known personalities involved in the FTX lawsuit include Tom Brady, Gisele Bündchen, Trevor Lawrence, and Kevin O’Leary.
Shortly after the fall of FTX in November 2022, an individual filed a class action lawsuit against the Golden State Warriors, alleging that San Francisco-based professional basketball team promoted FTX as a safe platform to invest in cryptocurrency.
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