Crypto Influencers Face $1B Lawsuit for Promoting FTX

A group of YouTubers and influencers has been charged for promoting the now-defunct crypto exchange FTX. The filing stated that these public figures heaped praises on the company and its founder Sam Bankman-Fried (SBF), without fully disclosing the nature and scope of their sponsorship or endorsement deal. 

The Youtubers and influencers sued include Kevin Paffrath, Graham Stephen, Andrei Jikh, Jaspreet Singh, Brain Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, Erika Kullberg, and Creators Agency, LLC.

The lawsuit blamed the influencer’s promotions as the reason FTX had many casualties after their capitulation. For thousands and millions of dollars, the promoters hyped the deceitful exchange and increased creditors after bankruptcy.

Plaintiff Files For $1B in Damages.

The class action filed by the plaintiff requires that the influencers pay $1 billion in damages; the fee is exclusive of interest or cost. This is one of many lawsuits emanating from the FTX collapse. Three venture capital firms are also facing similar charges for promoting the exchange.

According to the lawsuit, the defendants “scrubbed” their Youtube platforms of all FTX-related promotions and replaced them with apology clips. However, the promoters should still be held liable for their actions and made to face the law.

The suit also claimed they aided and abetted unregistered securities and should be answerable to the law. The lawsuit implied that they did so for their financial gains and that of FTX.

Defendants Respond to Charges

Since the filing, a few defendants have responded to the charges against them. In a video conversation, Kevin Paffrath stated that he would willingly pay back some of the money made from FTX as charity. He, however, clarified that he was not to be held responsible for user losses.

In a chat with the media, Ben Armstrong stated that he never spoke with anyone at FTX or acted as its marketing agent. He also noted he received no financial benefits from the exchange and would file a countersuit in no distant time.