Warnings were issued to 17 celebrities by the consumer watchdog group ‘Truth in Advertising’ for shilling NFTs. Among those who were warned are Eminem, Neymar Junior, Jimmy Fallon and many more. While the Federal Trade Commission (FTC) has not been officially involved yet, we won’t be surprised if they are involved in the future if this continues.
Who is Shilling NFTs?
A total of 17 celebrities were identified who were warned for their shilling behaviours within the NFT space by Watchdog Group as this action is often frowned upon. The list includes Eminem, Neymar Junior, Jimmy Fallon, DJ Khaled, Drake Bell, Eva Longoria, Floyd Mayweather, Gwyneth Paltrow, Logan Paul, Madonna, Meek Mill, Paris Hilton, Shaquille O’Neal, Snoop Dogg, Timbaland, Tom Brady, and Von Miller.
What is Shilling?
For those who have never heard of this term, Shilling is a term commonly used in the Cryptocurrency world and also NFT space. What Shilling is is to promote some kind of project and it is done by celebrities for a large sum of money and it will be posted on social media platforms to promote the project to earn.
The act of shilling is often regarded as unethical as the advertising is done implicitly. Shilling is identified whenever an advertiser, usually a celebrity, who will reveal how much they have earned for a specific coin, even if they do not directly tell you to buy a certain coin or NFT collection.
An example is when Paris Hilton, Media personality and entrepreneur mentioned the 888 Crypto project to her 16.9 million Twitter followers.
Is Shilling NFTs Wrong?
Before any actions were taken by the FTC on shilling NFTs, the Truth in Advertising group stepped in to warn the celebrities before it gets out of hand. In simple terms, the act of shilling violates FTC guidelines. For example, if a celebrity has profit share or ownership percentage in the project but they do not disclose their connection with it, then they have gone against the guidelines.
A Preview of the Letter
A public exempt from the original letter was released as part of the BuzzFeed article writes: “We have found that celebrity NFT promotions is an area rifle with deception, including, but not limited to endorsed NFT company, as well as the omission of other digital assets, the financial harm that can result from such investments and the personal benefits the promoter may gain by virtue of the promotions.”
Are The FTC Going To Get Involved?
As of right now, it is a no. But if they have caught wind of the NFT shillings, and cases should increase, then they may do something about it. The FTC focused hugely before on advertisements, particularly unethical Instagram ads that are from celebrities and influencers including the Kardashians. This was a big deal to the point that they have change the rules because of the laws on social media advertising.