How Tom Brady’s crypto dreams were thwarted by reality
How Tom Brady’s crypto dreams were thwarted by reality
Tom Brady, the quarterback for the New England Patriots and winner of seven Super Bowls, placed an emergency call while the FTX bitcoin exchange was collapsing in the autumn of last year.
He gave Sina Nader, who was in charge of relationships at FTX, a call. The personnel of the exchange were in the middle of a crisis meeting with its founder, Sam Bankman-Fried, who was in a difficult situation. Mr. Nader was unable to provide a response. “I never would have expected to turn down a call from Tom Brady,” he added. “It was completely unexpected.”
Mr. Brady had good reason to be concerned about the situation. In his capacity as a “ambassador” for FTX, he had previously made an appearance at the company’s conference in the Bahamas as well as in television ads promoting the exchange as “the most trusted” organisation operating inside the realm of crypto, which is characterised by lax regulations.
Additionally, his financial stability was at risk. According to three individuals who have knowledge of the transaction, Mr. Brady was paid $30 million by FTX as part of an endorsement agreement that he signed in 2021. The deal consisted virtually entirely of FTX stock, as stated in the previous sentence. One of the persons stated that the supermodel Gisele Bundchen, who was Mr. Brady’s wife at the time, was given $18 million worth of FTX stock as a payment.
They are the most high-profile example of a humiliating reckoning that awaits actresses, sportsmen, and other celebrities who raced to embrace the easy money and internet buzz of cryptocurrencies. Their plight is the most high-profile example of a humiliating reckoning. Paris Hilton, Snoop Dogg, Reese Witherspoon, and Matt Damon were among the celebrities who, during the peak times, raved about or invested in crypto ventures. As a result, they introduced a mainstream audience to the complex world of digital currencies. While prices were going through the roof, it was a lot of fun—not to mention profitable.
The cryptocurrency market crisis that occurred a year ago put a stop to the celebrity crypto feast.
The Securities and Exchange Commission issued a fine of $1.26 million against Kim Kardashian in October for violating the terms of her endorsement contract with the EthereumMax digital token by failing to provide proper disclosures. In December, a lawyer in California filed a lawsuit against two cryptocurrency businesses, MoonPay and Yuga Labs, accusing them of employing a “vast network of A-list musicians, athletes, and celebrity clients” to deceive investors about digital assets. The lawsuit was filed against MoonPay and Yuga Labs.
The Securities and Exchange Commission filed charges in March against many celebrities, including the actress Lindsay Lohan, the online influencer Jake Paul, and several singers, including Soulja Boy and Lil Yachty, for allegedly fraudulently advertising cryptocurrency assets. According to the documents that were filed in court, a process server finally handed court papers to former basketball player Shaquille O’Neal at the end of May. O’Neal was being sued for advertising FTX, according to the documents that were filed in court. While Mr. O’Neal was broadcasting from a National Basketball Association playoff game, he was presented with a drink.
Reps for Mr. Brady, Mr. Bankman-Fried, and MoonPay all declined to comment on the matter. Yuga Labs, according to a representative for the firm, has “never paid a celebrity to join the club.” There was no response to the requests for comment from the representatives of Ms. Bundchen and Mr. O’Neal.
Celebrities and new ventures in the field of technology have long had a mutually beneficial connection. The start-ups provide celebrities with an opportunity to generate money while still being on the leading edge of online culture. In addition, the celebrities’ involvement assists emerging businesses in building credibility and expanding their consumer base.
It’s possible that FTX was the most anxious of all the start-ups to attract celebrities to advertise their cryptocurrency product. According to Mr. Nader, a former executive at FTX, while Mr. Bankman-Fried was working to make FTX a well-known brand, he compiled a list of famous people whom he thought may be interested in endorsing the firm as brand ambassadors. The first name on the list was that of Mr. Brady.
Mr. Nader, a former college football player, was in charge of recruiting Mr. Brady and other players, and he was also a former player himself. In June of 2021, Mr. Brady and Ms. Bundchen reached a business agreement with Mr. Bankman-Fried, during which they lauded the “revolutionary FTX team.” According to Mr. Nader, Mr. Brady appeared to have a genuine interest in crypto, and he periodically held chats about the topic with Mr. Bankman-Fried.
Mr. Nader replied, “Imagine a tiger and a lion talking to each other.” “They are really formidable in their own fields, despite the fact that they have some minor distinctions and engage in some unique activities.”
Mr. Brady also helped start Autograph in 2021, which is a company that assists renowned individuals in the process of selling crypto collectibles known as nonfungible tokens, or NFTs. Investors contributed more than $200 million to Autograph, and Mr. Bankman-Fried joined the company’s board of directors.
During the same year, Mr. Brady and Ms. Bundchen were featured in an advertising campaign for FTX that was worth $20 million and included advertisements that aired during National Football League games. Additionally, Mr. Brady released TikTok videos alongside Mr. Bankman-Fried from FTX’s headquarters in the Bahamas, where he was delivering a presentation in front of hundreds of people. In the backstage area, Mr. Bankman-Fried made a statement about how he and Mr. Brady may one day consider purchasing a football franchise together. In her role as head of environmental and social activities at FTX, Ms. Bundchen was also present at the meeting.
When FTX failed in November of last year, the business’s valuation of $32 billion plunged to nothing. This included Mr. Brady and Ms. Bundchen’s $48 million worth of shares in the company. According to one of the participants, the pair had also been given a little quantity of Ethereum, Bitcoin, and Solana tokens to trade on the platform. However, all of those tokens were lost when FTX filed for bankruptcy.
Mr. Brady has not made any statements that have been made available to the public regarding FTX or his connection with Mr. Bankman-Fried. Following the emergency meeting that FTX had in November, Mr. Nader gave him a call.
“He was concerned,” Mr. Nader said of the individual. “Sina, how are you doing?’ That was the very first question he asked me,” she said. I am aware that you have committed your entire being to this.'”
In an interview with Vanity Fair that was published in March, Ms. Bundchen said that she had “trusted the hype” and that she was “blindsided.”
The second cryptocurrency endeavour that Mr. Brady is involved in has likewise been unsuccessful. During the bear market for cryptocurrencies, Autograph’s income took a nosedive, according to a source familiar with the company’s financials. According to the individual, the start-up has adjusted its strategy such that it focuses less on marketing crypto tokens to customers and more on assisting celebrities in finding methods to create loyalty with their respective fan bases. Another individual who is familiar with the company stated that the corporation has deleted certain crypto-related verbiage from its marketing and has downplayed words such as NFT.
According to a third source, Autograph has also conducted layoffs affecting more than 50 of its workers. Insider was the first publication to reveal the price cuts. A spokesperson at Autograph declined to comment on the matter.
