In a new class action lawsuit, YouTubers who endorsed FTX before its collapse in November of last year are being sued for $1 billion. This latest legal action is part of the larger controversy surrounding the crypto exchange platform, which has led to many lawsuits against those involved. The suit alleges that these YouTubers were responsible for promoting the failed exchange and are liable for damages. However, this follows similar legal action against celebrities who endorsed FTX before its bankruptcy.
The new lawsuit against FTX crypto influencers
The FTX collapse has been one of the most contentious issues in the digital asset industry. In late 2022, multiple cases of fraud involving the exchange and its sister platform Alameda Research were uncovered, bringing it into disrepute. Furthermore, a new class action lawsuit has been brought against YouTubers for promoting FTX and removing clips endorsing the now-defunct exchange from their channels. Reports claim that these influencers were complicit in promoting the exchange while withholding its true history of failure.
The lawsuit revolves around influencers promoting the exchange without disclosing if they had received any payment or compensation. Those sued include Erika Kullberg, BitBoy Ben Armstrong, and Kevin Paffrath of “Meet Kevin.” Representing the plaintiffs is Adam Moskowitz of the Moskowitz Law Firm, who is also involved in a similar case against celebrities such as Tom Brady, who had heavily advertised the now-defunct exchange.
The complaint filed against FTX states that the company paid defendants to promote their brand and encourage their followers to invest without disclosing the magnitude of these sponsorships and endorsement deals, payments, or compensation. As a result, it is believed that this legal action may be one of the only ways for victims to recoup any losses.
