- Being frontline campaigners, influencers are facing the heat for supporting FTX.
- While some facing legal action, others are rethinking their endorsement options.
It seems that the collapse of FTX was an eye-opener for many people directly or indirectly associated with crypto. After emerging exchanges and investors, it is the influencers who are now taking cognizance of the situation. Many crypto influencers who (before the collapse of FTX) were hungry for endorsements are turning the offers down.
That’s the aftermath that brought lawsuits against many celebrities and influencers who promoted the exchange without disclosing compensation. According to Cointelegraph, many influencers have said that this incident has served as a red flag for them. They have realized that if the company they’re endorsing gets into legal trouble, it would tarnish their reputation too.
Moreover, they can also get inadvertently involved in lawsuits they never asked for. All because of one promotional campaign that pays a handsome amount. Tiffany Fong, a crypto vlogger who promoted FTX and gained fame due to it, says that advertising for crypto ventures is totally out of her list right now. In an interview with Cointelegraph, she says that you can’t rely on even the most reputable brands as they can fall and swindle their customers too.
Fong also says that she has received a lot of offers lately, but has turned down all of them. Another popular influencer DeFi Dad, with 152,300 followers on Twitter told about a recent offer he got and rejected from FTX. Expressing fear over getting associated with a sham project, he said he has turned down a large amount of money by rejecting many offers. He said that he also rejected working with FTX as the risks surpassed the rewards.
Furthermore, the agencies that brought the brands and influencers together are noticing reluctance on both sides. Nikita Sachdev, the founder, and CEO of Luna PR, told
Cointelegraph that it’s not just the influencers who’re taking steps cautiously, companies are also being prudent now.
Sachdev mentioned that the heightened scrutiny of regulations along with the ongoing downtrend is forcing the crypto firms to tighten their purse strings. Some companies are totally avoiding collaborations with influencers. Rasmus Rasmussen, the chief marketing officer of Polygon NFT game Planet IX enlightened Cointelegraph about it. He said that the failure of FTX has made associating with A-listed influencers quite difficult now.
Though few nfluencers who are still doing it are charging a hefty amount for the campaigns. The firm executives told that crypto influencers with high following and reach are charging 6 figures for sponsorship deals. According to them, some influencers even charge millions for endorsing web3 and other similar projects.
Meanwhile, some other crypto influencers have expressed their concerns over brand deals happening for the wrong reasons. Mason Versluis also known as Crypto Mason to a million followers on TikTok says that the FTX fiasco has opened the avenues for other ventures to indulge in high-octane marketing gimmicks. Another Crypto vlogger MegBzk suggests influencers need to be careful before associating with crypto firms. Before endorsing they need to know the company inside and out with all the research they can do.
Conclusion
Influencers and brands are quite complementary to each other. While the brands can use these individuals to promote their products, the influencers find a promising source of revenue with these collaborations. But incidents like these throw a wrench in an evolving environment for marketing or product development. The crash of FTX has been a learning lesson for many and it would be interesting how brands and influencers will market further.
