UpdatesMar 20, 2023

Influencers promoting FTX on YouTube have been sued

Several influencers with large social media reach have been sued for soliciting investment in FTX.

A group of former investors in the collapsed cryptocurrency derivatives exchange founded by Sam Bankman-Fried filed a class action lawsuit on Wednesday, March 15 against a number of influencers with large social media reach. The plaintiffs in the lawsuit claimed that influencers, when promoting FTX, urged the purchase of unregistered securities. The plaintiffs are seeking $1 billion in damages from them.

Influencers promoting FTX on YouTube have been sued

A class action lawsuit has been filed in the District Court of the Southern District of Miami, Florida against several influencers with large reach who recommended investments on FTX. It was submitted by a group of former investors of the bankrupt stock exchange. In it, they stated that content creators encouraged their viewers to buy unregistered securities while promoting a platform founded by SBF.

The accusers are seeking $1 billion in damages. They sued influencers with millions of followers. This list includes, among others, the creator of the YouTube channel BitBoy Crypto - Ben Armstrong, who is currently followed by 1.45 million users. YouTuber Graham Stephan with 4.25 million followers on his channel was also mentioned. Accusations were also made against 7 other people and Creators Agency.

In an interview with the media, the owner of the BitBoy Crypto channel pointed out that he had never received remuneration from FTX for recommending financial products of this exchange, nor had he signed any cooperation agreement with it. He added that the allegations against him are 100% false and he will be able to prove it without any problems.

The unregistered securities referred to in the lawsuit were investment accounts offering profits that were maintained by FTX.” The plaintiffs also pointed out that the defendants were paid for promoting the exchange, which was a fraudulent scheme designed to profit from naive investors around the world.

Among the plaintiffs who signed the class action lawsuit were residents of the United States, Canada, the United Kingdom and Australia. The defendants were accused, among other things, of misleading investors.

According to the plaintiffs, YouTube has become the main tool that played a key role in the promotion of FTX by influencers. After the collapse of the exchange, several creators deleted their recordings in which they praised this platform and its founder. In some cases, this content has been replaced with apology videos directed at viewers.

One of many lawsuits

The FTX cryptocurrency platform collapsed spectacularly in November 2022. Its founder and former CEO faces a number of serious allegations. After being extradited from the Bahamas to the United States, he was released from prison on bail of as much as $250 million. He is currently under house arrest in California awaiting trial in October 2023. Last month, the SBF faced additional criminal charges.