The FTX crypto currency exchange has filed for Chapter 11 bankruptcy and its founding CEO, Sam Bankman-Fried, has resigned. In a stunning turn of events, it has been revealed that 1.7 billion dollars of clients’ money is missing. This news has sent shockwaves throughout the world of cryptocurrency, as FTX was one of the most popular exchanges. Celebrities and athletes who had formed partnerships with the company are now scrambling to distance themselves. Tampa Bay Buccaneers Tom Brady and Golden State Warriors Steph Curry hold shares within the company. Curry even had a partnership with them personally as well as via his charity Eat. Learn. Play. Many celebrities rushed to back crypto but the question comes to mind; where is the due diligence on their part.

Thirty years ago in the nineties celebrities were cautious about endorsing things. You could actually take your ten figures and count how many items were supported by celebrities. It was so sparse that when a celebrity did support something that product stood out. For example actress Suzanne Somers thigh master, Boxer George Foreman and Foreman Grill, actress Elizabeth Taylor, White Diamonds perfume. These products stood out because there were not many celebrities supporting items. Those who did, did their due diligence on the product because this was their reputation.

I recall watching a documentary of Joan Rivers and during this documentary she said she is an industry because she had a team to support. She also said because of this reason she vetted every opportunity that came her way to make sure it was the right one. If something was pitched to her, she would take the information and have her manager do research and report back to her his findings. Celebrity endorsements have increased with the age of the internet. The question that comes to mind is, are celebrities and athletes doing research or are they just listening to pitches and focusing on trends. This crypto debacle is a perfect example of the lack of due diligence. Golden State Warriors, Klay Thompson and Andre Iguodala made headlines in early 2022 when they announced that they would be receiving a portion of their salaries in Bitcoin. Given the volatility of Bitcoin, this was a courageous move by both players but it cost them 50% of their salaries after the collapse.

As a celebrity or athlete, you have access to resources that allow you to investigate companies, products and services before endorsing them. When you endorse something, you’re essentially saying that it’s something you trust and that your fans will like it too. So it’s important to vet any product, service or company thoroughly before endorsing it, because it can take years to build up a reputation but only seconds to destroy it. For example, Kevin O’Leary – one of the Shark Tank judges – lost money in the bitcoin collapse. As a business expert who makes thousands of deals on and off screen, this was hit to him financially as well as his reputation. There are countless celebrities who ruined their reputation endorsing bad deals and they have not come back from that; Ja Rule is one of them. His career has never been the same after his endorsement of the Fyre Festival. Protecting one’s reputation is worth its weight in goal because this can affect your entire livelihood.