Finance influencers who promoted FTX are saying ‘sorry’ to fans and promising to do better — and it shows the risks of giving investment advice to your followers

Sam Bankman-Fried is the founder of FTX Crypto Exchange
Sam Bankman-Fried.

  • Crypto-exchange platform FTX has filed for Chapter 11 bankruptcy.
  • Crypto Farm has worked with many top personal finance influencers.
  • YouTube star Graham Stephan apologized to fans on Thursday: ‘I was wrong and I’m sorry.’

Money influencers promoting FTX are doing some soul-searching in the wake of its implosion.

The crypto-exchange platform has invested millions of dollars in partnerships with celebrities like Tom Brady and top influencers.

The platform, which filed for bankruptcy on Friday, remains in crisis. Sam Bankman-Fried resigned as CEO on Friday and FTX US has stopped withdrawing.

FTX has had several high-profile deals with celebrities, athletes and influencers, including a 19-year sponsorship of the Miami Heat for $135 million. In response to the news, some influencers who promoted the company through paid deals and affiliate marketing are apologizing to their fans.

Among the celebrities and influencers on FTX to talk about the platform was personal finance YouTuber Graham Stephan, who released a video on Thursday titled, “Let’s Talk About FTX.”

“As much as I trusted the information I was given, I was wrong and I’m sorry,” Stefan told his 4.1 million subscribers. “I trusted them, but in the end their parent company wasn’t taking all the risks. This is one of them. This kind of behavior is not something I would have ever expected.”

Stefan is among the few YouTube creators who have built profitable businesses by making videos about financial topics like budgeting and investing. He regularly promotes FTX US on his YouTube channel, encouraging fans to use the platform.

“I canceled with FTX US before our contract ended,” Stephan told Insider via email. “The situation is extremely frustrating for everyone. I’m taking a step back to reevaluate how I can improve moving forward, because my audience deserves it.”

Stefan has built a loyal fanbase on YouTube by sharing financial advice. He has several videos on investing and saving money with millions of views. The parasocial relationship between an influencer and their fans can become complicated when a listener looks to a creator for specific advice.

“I’ve been waiting for this video,” one viewer commented apologetically. “After how hard you put FTX on video and podcasts. But if you’re going to be transparent, I think everybody wants to know what you can get out of a partnership like this or a similar platform.”

Like Stefan, other creators including Max Maher (905,000 subscribers), Coin Bureau (2 million subscribers), Tom Nash (285,000 subscribers), and Minority Mindset (1 million subscribers) released videos this week addressing the situation and their relationship with FTX. Us.

“I deeply regret any past association with the FTX US company,” Maher said in a Nov. 11 video titled “FTX: The Truth.”

“It’s ridiculous that we as individuals have to question the biggest companies in the world. But we do,” he added. “My entire platform is built on trust and thorough research in everything I do. You can bet from here on out that I’ll be more diligent when verifying anyone I mention in my videos.”

Some influencers believe that the sector was vulnerable even before FTX’s problems. The three personal finance influencers told Insider that they will always stay away from promoting any crypto-exchange platform.

“While I myself own a small amount purely as a speculative ‘gambling’ investment, I do not advise my audience to invest in such things unless they have a solid financial foundation and can’t afford to potentially lose that money,” Sarah Wilson, who Run the YouTube channel Budget Girl, writes Insider. “That’s hard to convey in an ad, and it’s usually a dealbreaker for sponsors.”

The second personal finance influencer with 1 million customers, who spoke to Insider on condition of anonymity to protect their relationships with the brands, said they refuse to work with FTX US and other crypto-exchange platforms because of how unregulated the market is. .

Chris Norlund, who runs a YouTube channel with 21,000 subscribers, has several videos criticizing creators in the personal-finance community for peddling crypto and NFTs. He told Insider that YouTubers need to remember how young and impressionable their audience can be.

“Think about the people you’re hurting,” he said. “You want to play for the long game, and you want to build relationships with people forever.”

FTX, Maher, Coin Bureau, Nash, and Minority Mindset did not respond to Insider’s requests for comment.

Read the original article on Business Insider

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