Celebrities endorsing products is nothing new. TV commercials, billboards, magazine ads, and more recently social media promotions have always featured high-profile figures of entertainment and sports peddling all sorts of stuff. From make-up, sunglasses, cars and clothes to fitness trends and diets – if it’s on the market and it’s mainstream, chances are there is a celebrity attached to it.
It’s a marketing strategy that has generally proven to be effective. If a major Hollywood star promotes a watch brand, it will likely drive sales for that watch company. The same holds true for sports equipment, apparel, and essentially any industry. Lionel Messi and Adidas football, Tiger Woods and Nike golf, the list goes on…
These forms of celebrity endorsements have always been relatively transparent and harmless. If Cristiano Ronaldo wants to try and sell you a perfume, what’s the harm?
However, a new trend of celebrity endorsement has emerged in recent years that is causing no small amount of suspicion and skepticism: cryptocurrency.
It seems the Internet is now flooded with celebrities peddling one form of cryptocurrency or another, whether it’s specific coins, crypto-based apps, or the constant deluge of various NFT projects.
Celebs go all in on crypto
The problem here lies in the volatility and complexity of cryptocurrencies. These are the two major factors that seem to get conveniently ignored by the famous faces being paid huge sums of money in exchange for the product/company ambassadorship.
Granted, crypto is becoming more widely understood and is an increasingly accepted form of currency – from retailers and fast food outlets to travel operators and crypto casinos, there are countless merchants across the globe that now accept Bitcoin and other leading crypto as forms of payment.
Yet, there are still many people who don’t understand what crypto is and how it works. These are the very people, the target market for such high-profile marketing plans, who are most at risk when it comes to crypto volatility, and who therefore risk losing money (in some cases significant sums) on forays into digital currency investments and NFT projects.
The murkier side of these crypto-related endorsements was revealed earlier this year when Kim Kardashian, a former boxing star Floyd Mayweather, and an ex-NBA player Paul Pierce were among several figures of a certain California lawsuit accused of using their profiles to “pump” EthereumMax as part of a larger scheme which defrauded investors and made money for themselves.
While there is something quite shady about celebrities being paid to be involved in little-known ventures like EthereumMax, the presence of famous faces plugging established currencies and crypto platforms has also raised a few eyebrows. For instance, Matt Damon has become the face of Crypto.com, the Singapore-based cryptocurrency exchange, and appeared in a big budget commercial in which he professes that “fortune favors the brave.”
Crypto investing ‘favors the brave’
Damon isn’t exactly wrong about his statement as investing in crypto does require an element of bravery, particularly for the many potential investors who are uninformed. The lack of transparency, regulation, and volatility around crypto have always been appealing factors for investors, but to make smart investment decisions requires a deep level of knowledge and understanding of the crypto space – and ultimately, these are not the potential investors that celebrity-led marketing is aiming to attract.
And that is where the uneasiness of celebrity endorsements of cryptocurrency comes in. Surely, they are aware that the purpose of their presence in commercials and roles as ambassadors is to appeal to a mass market – and that much of the mass market will have little understanding about the complexities and volatility of crypto. Based on that, there is an element of irresponsibility to all of this, of using star power to nudge the masses into making potentially risky financial decisions.
That being said, this is not to warn people off getting involved in crypto, far from it. It is becoming more important than ever to be better educated in the world of digital currencies and blockchain, both from an investment standpoint and with how these technologies work as they become increasingly present in daily life.
Our aim is to warn against the increasing trend of using celebrities to peddle crypto products and services aimed at certain target demo which would invest purely because of the celebrity promoting it. If that product was a watch, a perfume, or a box of pizza, no harm would be done, but when it involves volatile financial commitments that involve a great amount of risk, both celebrities and their fans should think twice before making any commitments or signing any deals.
