The cryptocurrency winter that began in late 2021 has undeniably devastated prior big names in the industry all over the world. Starting from the collapse of Terra Luna UST, 3AC, FTX, Alameda Research, and DCG’s Genesis Trading in the past 18 months, big names in the industry have gone down. As a result, regulators all over the world have heightened scrutiny of the nascent crypto market to ensure safe adoption. Moreover, regulators understand it is next to impossible to ban the cryptocurrency market and the industry knows that scrutiny is the holy grail of mainstream adoption.
Tom Brady’s Autograph Sunk with FTX
At the peak of FTX and Alameda Research, Tom Brady’s legendary name was used to lure crypto investors to the exchange. As a result, Brady was awarded about $48 million among other incentives to keep advertising FTX to his fans. In exchange, the NFL superstar had a direct connection with FTX founder Sam Bankman Fried (SBF). Amidst the 2021 cryptocurrency hype, Brady founded the NFT marketplace dubbed Autograph to help famous people sell their digital collectibles.
Interestingly, Autograph NFT marketplace raised more than $200 million from investors in 2021, and SBF joined the firm’s board members. Fast forward two years later and people familiar with the company’s financial outlook confirmed huge imbalances. With minimal revenue, Autograph has ostensibly sent home 50 of its employees and changed its operating strategies.
Reportedly, Autograph has shifted its business strategy to focus more on helping celebrities sell loyalty to their fans, as it spends fewer resources on marketing crypto tokens to consumers. The move is a direct implication of the ongoing crypto regulatory scrutiny in the United States amid calls for digital assets as unregistered securities.
Meanwhile, Brady is facing legal charges after Adam Moskowitz and the law firm Boies Schiller Flexner filed a lawsuit accusing the NFL superstar of misleading investors.
“None of these defendants performed any due diligence before marketing these FTX products to the public,” the lawsuit said.
Undeniably, the credibility of Autograph was significantly tarnished by the implosion of FTX and Alameda Research. Moreover, some FTX creditors have sued Brady in a bid to accrue lost funds.
The cryptocurrency market is undeniably changing the face of the global financial outlook despite the suppressed prices. The rise of NFTs and crypto assets is slated to widen with real-world utility away from mere speculation. Nonetheless, experts have argued a lot of education in the cryptocurrency industry is needed to inform investors of how to securely tap into the nascent blockchain technology. Moreover, rug pulls and hacks are rampant in the cryptocurrency market due to a lack of widespread regulatory frameworks.