All those celebrities pushing cryptocurrencies aren’t so vocal now

In the latest Crypto.com virtual currency exchange commercial, titled “Courage is a Process,” famed basketball player Joel Embiid walks around Philadelphia while Bill Self, his former college coach, lends the narrative.

“Even when our path didn’t make sense to everyone else, we moved on,” says Mr. Self in the announcement, which premiered on May 6. “We continue, until our path is what they want”. I took.

What the ad does not say: The the cryptocurrency market is in the midst of a meltdown. Buyers beware.

The cryptocurrency enthusiasm of Hollywood celebrities and top athletes has peaked in the past year. On social media, in interviews, and even in music videos, they portrayed virtual currency as a world with its own trendy culture and philosophy, more inclusive than traditional finance, and one that had the potential to make a lot of money.

The Super Bowl was dubbed the “Crypto Bowl” this year because so many advertisements – costing up to $ 7 million for 30 seconds – featured the industry, many with bold names.

But after investors watched hundreds of billions of dollars disappear in a sell-off this month, those famous boosters now face mounting criticism for helping to push vulnerable fans to invest in cryptocurrencies without emphasizing risk. Unlike clothes, snacks, or many other products sold by celebrities, the cryptocurrency market is volatile and rife with scams.

“This is real money that people are investing,” said Giovanni Compiani, assistant professor of marketing at the University of Chicago, whose research found that younger, lower-income investors tend to be overly optimistic about the trajectory of cryptocurrencies. “Those who promote it should be more ahead of the potential downsides.”

So far, proponents of cryptocurrency celebrities have been largely silent on whether they have second thoughts about their promotions.

Crypto.com declined to make Mr. Embiid available to discuss his partnership with the company. Matt Damon, who compared the advent of virtual money to the development of aviation and space flight in a criticized but widely viewed Crypto.com ad last year, did not respond to requests to weigh. No word either from basketball star LeBron James, who appeared in the company’s Super Bowl commercial this year.

Reese Witherspoon, an Oscar winner who said online in December that “cryptography is here to stay,” did not respond to a request for comment. Not even Gwyneth Paltrow, another Oscar winner, who lent her name to a Bitcoin giveaway late last year.

Paris Hilton, who has nearly 17 million Twitter followers watching her coo about her Crypto and Ether doggies, I remained a mother. Many other famous cryptocurrency dealers, such as Mila Kunis, Aaron Rodgers, and Tom Brady, were also silent (although Mr. Brady and Mr. Rodgers Twitter profiles are still present. laser eyesa popular symbol of Bitcoin’s rise).

Jimmy Fallon, who argued non-fungible tokens on the air, he joked Monday during NBC Universal’s early showcase for advertisers that he had to be involved in three separate shows due to Bitcoin. A representative of Naomi Osaka, the tennis star who became an ambassador for the cryptocurrency exchange FTX this year, wrote in an email that “unfortunately she is overseas and not available”.

In the FTX Super Bowl commercial, comedian Larry David vilified major inventions such as the wheel and light bulb before rejecting cryptocurrencies. The announcement winked at viewers: “Don’t be like Larry.”

Jeff Schaffer, the director of that Super Bowl commercial, said in an email that he and Mr. David did not comment on the market crash.

“Unfortunately I don’t think we would have anything to add because we have no idea how cryptocurrency works (even after explaining it to us repeatedly), we don’t own it and we don’t follow the market for it,” he said. “We just decided to do a funny commercial!”

Crypto instability underscores a basic celebrity marketing blunder: A celebrity endorsement can be memorable – actor John Houseman’s jobs for investment firm Smith Barney decades ago are a Madison Avenue legend – but it doesn’t make the pushed product inherently worth trying.

“This is what they do: They are celebrities, they have been offered money to promote something that has a promise,” said Beth Egan, associate professor of advertising at Syracuse University.

But it wasn’t without risk, Ms. Egan said. If the cryptocurrency industry continued to grow, or if it returned to its high-flying status, the sponsors could be commended. But if the crisis continues, their reputation could suffer.

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

In March, Crypto.com spent an average of $ 109,000 per day on digital advertising, according to estimates from ad analytics platform Pathmatics. In May, it dropped to $ 24,669 per day.

According to Pathmatics, spending on FTX, one of the cryptocurrency companies that used celebrity promoters most aggressively, dropped to $ 14,700 per day from $ 26,400 per day in March.

“We somehow created this arms race,” Brett Harrison, president of the US arm of FTX, said of the use of famous testimonials in an interview before the February Super Bowl. Famous FTX brand ambassadors have included Mr. David, Mr. Brady and his supermodel wife, Gisele Bundchen, golfer Albane Valenzuela, football player Aaron Jones, basketball player Stephen Curry and baseball player Shohei Ohtani .

“We’ve planted our flag there and have such a huge presence that racing for all the remaining properties, athletes and celebrities isn’t necessarily our top priority,” he said.

But the company, which would most likely “spend a pretty significant amount more” on marketing, is now focusing on reaching different demographics and pursuing simpler tactics, like digital campaigns and Google ads, he said.

“We are thinking of doing things a little differently than in the past,” he said.