The market on cryptocurrency is something that has exploded in the past year, with investors coming in from several sectors and spaces. As people come into the market, the amount of celebrity endorsements for various cryptocurrencies is rising.
One of the best examples of this is the famed boxer Floyd Mayweather. Mayweather decided to put out information to his millions of followers about a new initial coin offering or ICO of a cryptocurrency known as Centra Token. This token was also promoted by DJ Khaled in a similar fashion. Centra has since then been looked at as something that is sketchy and not legitimate. The New York Times recently wrote that the company has issues such as “a chief executive who does not appear to have been a real person and a shaky, fast-shifting business plan.”
The advertisements by the two celebrities in combination with other sources of traffic driving meant that the company raised around $30 million. After this, two of the three co-founders were indicted on perjury charges.
This may seem out of the ordinary, but it is far from it. This is the theme that continues to present itself with cryptocurrency. Many illegitimate companies have come forward to bring a bad light to the cryptocurrency market as a whole. This continuous fraudulent activity has made the reputation for cryptocurrency slightly off putting for investors.
Attorney Blake Estes recently stated that celebrities can also find themselves in trouble if they get involved with these types of situations. He stated that “celebrities may see ICOs as just another product to sell, but the SEC is paying close attention, and it definitely views some ICOs as securities offerings.” Hopefully this sketchy attitude in the market can change, and cryptocurrency can reach its full potential.