Be wary of Super Bowl crypto ads
Tom Joyce
If you want to make money, do not look to Super Bowl commercials for crypto advice.
Various cryptocurrency companies aired Super Bowl commercials last year, reaching tens of millions of the public. The results for investors, however, were poor. People should not repeat the same mistakes.
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Crypto investments are risky to begin with, even when it comes to more reputable coins. About three-quarters of new crypto investors lose money, according to Barrons. If people insist on investing in crypto without much knowledge, they should at least avoid making their decisions based on Super Bowl commercials.
Last year, FTX, Coinbase, Crypto.com, and eToro had Super Bowl commercials.
Most notably, FTX filed for bankruptcy in November. Before its breakdown, its ad featured Larry David, who was skeptical of investing in crypto after being wrong about several historical events. The ad then told people not to be like Larry.
However, in this case, the co-creator of Seinfeld and the creator of Curb Your Enthusiasm was correct. The company lost more than $8 billion of its customers’ money. And FTT, the cryptocurrency created by FTX, now sells for under $2 per coin; the coins were worth about $45 in early February 2022.
The company’s founder, Sam Bankman-Fried, is facing up to 115 years in prison on charges of fraud and money laundering.
Coinbase is also doing poorly. Its stock value at this time one year ago exceeded $200. Now, Coinbase stock is worth $73.79 per share. The company lost more than $500 million in the third quarter of 2022 alone. Plus, it lost 500,000 users that quarter, dropping from 9 million to 8.5 million.
Meanwhile, the value of Crypto.com’s utility coin, Cronos, has tanked. The website, which hired Matt Damon to be the face of its brand, accidentally transferred more than $10 million to an Australian woman last year. While its coin was worth about $0.50 around this time last year, it is now worth about $0.08. That means it is worth about six times less than one year ago. That is a terrible return on investment.
While eToro is not doing as poorly as the other three crypto companies, it is a different product from theirs. The company also serves as a platform for people to buy and sell stocks, not just crypto. It has existed since 2007, two years before bitcoin’s initial launch. However, eToro started allowing people to buy FTX’s FTT coin last May, so the company does not deter people from purchasing lousy products on its platform.
If you want to invest your money, it is best to research and not make rash decisions based on hype built up by commercials — even, or perhaps especially, if they rely on celebrity endorsements.
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Tom Joyce (@TomJoyceSports) is a political reporter for the New Boston Post in Massachusetts.