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During the early 2022 NFT craze, some odd things happened. People paid hundreds of thousands of dollars for unique images, and celebrities appeared on late-night talk shows to promote them. It was a strange time.
That was the scene when socialite Paris Hilton appeared on The Tonight Show with Jimmy Fallon, where the pair discussed the merits of their extremely expensive Bored Ape Yacht Club (BAYC) NFTs at length.
It was an odd spectacle, and now, both are named in a class-action lawsuit alongside dozens of celebrities who promoted BAYC NFTs, with the plaintiffs seeking millions in damages.
Why Are Celebrity Bored Ape Yacht Club NFT Owners Facing a Lawsuit?
According to the Real v. Yuga Labs papers filed in a California federal court in early December 2022, the plaintiffs claim that all celebrity endorsements of BAYC NFTs were misleading and that the accused stood to benefit from the promotion but didn’t disclose this information.
Yuga’s flagship NFT collection, the so-called Bored Ape Yacht Club(“BAYC”), and related brand rely heavily on the perception that “joining the club” (i.e., buying a BAYC NFT) brings investors status and provides them access toevents, benefits, and other lucrative investment opportunities exclusive to BAYC holders
The court documents go on to claim that Yuga Labs’ entire business model “relies on using insidious marketing and promotional activities from A-list celebrities.”
Which Celebrities Are Named in the BAYC NFT Lawsuit?
It’s an extensive list. We won’t cover them all, as the full list is available in the linked court documents, but some of the accused include The Weeknd, Justin Bieber, Serena Williams, Snoop Dogg, Kevin Hart, Paris Hilton, and DJ Khaled, among numerous others.
The lawsuit alleges that the celebrities were all paid to promote Bored Ape Yacht Club NFTs during the peak of the NFT craze, helping to push prices for what became the most popular and elusive collection to extraordinary highs. For example, the most expensive Bored Ape NFT sold for a staggering $3.4 million.
Linking the celebrities is Guy Oseary, whose venture capital firm invested early in the crypto payment platform, Moonpay. The documents allege that Oseary worked with Yuga Labs to promote the NFTs, creating hype and pushing more payments toward Moonpay.
As a prime example, on the aforementioned episode of The Tonight Show, which aired on 11 November 2022, presenter Jimmy Fallon announced that he purchased his BAYC NFT through Moonpay. Others, such as Gwyneth Paltrow, failed to reveal that they held a stake in Moonpay, despite promoting the company.
Can You Trust Celebrity Crypto Endorsements?
In the early years of crypto, celebrity endorsements weren’t an issue. But as crypto boomed—and busted—celebrity cryptocurrency promotions have become infamous, with celebs from all walks of fame attempting to push you into buying crypto.
One infamous endorsement is NFL legend Tom Brady, NBA legend Steph Curry, and four-time WTA Grand Slam winner Naomi Osaka promoting the FTX exchange. Yes, the same FTX exchange that crashed in November 2022, taking billions of dollars of investor funds with it.
Other celebrity crypto endorsers include Reese Witherspoon, Mike Tyson, Nick Carter, Matt Damon, Kim Kardashian, and Floyd Mayweather, some of whom have already been named in other lawsuits relating to egregious crypto and NFT promotions.
So, can you trust a celebrity to endorse a crypto or NFT? That’s a solid no.
Given that the majority of the time the arrangements are made by the celeb’s PR team, they likely have absolutely no understanding of the technology or what they’re lending their name to.
In a market dominated by its lack of regulation, trusting the word of a celeb with money to gain and absolutely nothing to lose is a fool’s errand.
Never Invest More Than You Can Afford to Lose
It’s a difficult market. Crypto has become so huge that massive sponsorships are now commonplace. You only have to switch on the Formula 1 or tune into the NBA, NFL, or a soccer match from any of the top leagues to see arenas covered in crypto logos.
Such sponsorship brings crypto into the focus of the public, and with celebrities backing projects they have little understanding of (or at the very least, lending their names without double-checking), unsuspecting regular folks are bound to get caught up—and risk losing a lot of money in the process.
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