Millennials flocked to the Bahamas in 2017 for the Fyre Festival, which features top models like Kendall Jenner as billboards.
What happened next is well known to many. Local businesses were hit hard, meals were served with disastrous cheese sandwiches, and deceived attendees filed a class action lawsuit against organizers who spent their ticket dollars to live a lavish lifestyle. rice field. It has been the core of this uproar. It’s “influencer marketing”.
Celebrities who didn’t properly check the new festival concept and didn’t reveal their financial ties to the festival were paid a visit by investigative agencies. Kendall Jenner, for example, was forced to pay $90,000 for her role in promoting the festival.
From tropical paradise to celebrity involvement, Fire Festival resembles the FTX bankruptcy and other high-profile crypto-related scandals in recent months.
Promoted by celebrities
Despite the lack of regulatory clarity around crypto assets, and even the lack of compliance oversight faced by traditional financial institutions, American Football League NFT star Tom Brady said: Got FTX’s stamp of approval. Meanwhile, Sam Bankman-Fried’s team lost billions of dollars and fell behind by $55,000 in payments to a bar at a resort in the Bahamas.
Kendall Jenner’s half-sister Kim Kardashian was also targeted by regulators and fined $1.26 million for promoting the ethereumMax pump-and-dump scam paid for. Even more ironically, the land where the Fire Festival was held is now being sold as an NFT.
Celebrities, and the managers who bring advertising jobs to celebrities, owe it to their fans and followers to ensure that their products and services are properly checked and that they understand exactly what they are promoting.
Most Web3 developers are familiar with the risks of investing in crypto assets and DeFi architectures, but Kim Kardashian’s 228 million Instagram followers are talking about ‘portfolio diversification’. Not likely to be familiar with it. Followers are like sheep being led to the slaughterhouse by someone who has never had an opinion on Ethereum.
Unfortunately, celebrities are only part of the current crypto marketing problem. An industry of Web3 YouTubers, Twitch streamers and TikTok stars has emerged during the coronavirus pandemic. Most of these creators post videos with good intentions and want to share their passion for cryptocurrencies and blockchain, but they are paid to advertise or make a profit without disclosing that they are earning money. There are also people
In order to create a Web3 without bad guys doing pump-and-dump scams, the mechanics of crypto marketing incentives must change.
The US Federal Trade Commission already requires individuals to disclose their advertising rewards, but the world of Web3 is filled with unproven startups, value propositions and teams that need more accountability.
Advertisers in this space need to explain why they chose to partner with a brand. Unlike skin care products and goods, crypto assets directly affect financial markets and carry the risk of contagion to other areas such as derivatives.
Blockchain technology, which is open and all transactions are verifiable, is designed with transparency in mind. Legally and morally, those who promote the goodness of this technology must follow this vital principle, and the industry needs to hold them accountable.
Crypto-related influencers, marketers, and PR people will spend more time digging deep into the underlying architecture of blockchains, discovering their own thoughts and stances on crypto-assets and decentralization, and taking action. It should be used as a guideline when choosing a project to work on.
You cannot educate others without first educating yourself. This should be self-evident, but following the demise of FTX and Celsius Network, the industry has adopted a zero-tolerance policy for promoters who rave about their brands without understanding and respecting their core technology. need to adopt.
As a first step, companies and influencers should start by measuring their reach on social media as a way to quantify their potential impact on financial markets and the public at large.
The marketing company I founded, Oxygen, makes Web2 and Web3 marketing transparent by using data analytics to understand and validate online creators and brands and their associated on-chain activity. Our mission is to bring about sexuality.
Our partners, such as CreatorDAO, a fundraising and technology platform that helps creators, play an active role in educating influencers on how to best promote to protect their followers. By clarifying how to define targets, marketing teams can take an important step in embracing accountability.
Crypto marketing in 2023 will undoubtedly be centered around establishing new regulatory frameworks, but it will also need to adopt new cultures and behaviors. Celebrities promoting cryptocurrency companies to the general public should at least be able to explain how the concept fits within the blockchain ecosystem, from protocol level to consensus mechanisms. .
Those in authority in the Web3 world (venture capitalists, founders, etc.) promote companies with good intentions, admit when they’re wrong, and code code rather than brand associations with centralized vested interests. can shed light on individuals passionate about the ideology behind
Mr. Nemo Yang: Founder and CEO of Oxygen, a Web3 marketing platform.
｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
| Image: Kim Kardashian trading card (3Hunna S. Thompson/CoinDesk)
｜ Original: Crypto Marketing Needs to Change. Let’s Make 2023 the Year for Influencer Accountability