FTX Spent Big on Celebrity

For a while crypto was probably the highest bidder for celebrity and influence. A ton of money flowed into crypto over the last few years. Margins were high; it’s not like crypto firms had to build a lot of factories and hire a lot of workers to make new tokens. Crypto went up based on social adoption, on widespread respectability, on the prospect of increasing legality. If you were a crypto firm in 2022, funneling gobs of money to politicians and former regulators and celebrities was a really good investment in making your firm popular and respectable, and it didn’t really compete that much with other investments. If you are Apple Inc., it is good to have regulators on your side and celebrities endorsing your products, but also you make phones and if you spend a lot of money making the phones better then customers will want more of them. For large parts of the crypto ecosystem that, uh, was not really an option. Influencer marketing and political lobbying were valuable and viable; making useful products that appealed to consumers in an immediate and intuitive way was not.

And so here is a New York Times story about some guys who were in the celebrity-and-influence business and were at the top of their game: