February 06, 2019

INSIGHTS: Celebrity Endorsements and Cryptocurrency – A Cautionary Tale

By Michael S. Poster and Peter F. Cifichiello
Bloomberg Law

The recent “altcoin” hysteria that peaked at the end of 2017 and then came tumbling down in the cryptocurrency crash that followed was illustrative of the mindset of many dreaming of a quick buck. Within the sector, many crypto companies (not to mention hopeful investors) are bullish on a rebound in the wake of the turmoil of 2018.

For boxing champion Floyd Mayweather and celebrated media personality and music producer DJ Khaled, the altcoin turmoil they have endured has nothing to do with valuation. In November 2018, the Securities and Exchange Commission ordered them both to pay disgorgement, penalties and interest for promoting investments in ICOs (Initial Coin Offerings), including one from cryptocurrency issuer Centra Tech, Inc.

Michael S. Poster

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