In a surprising turn of events surrounding the demise of the FTX cryptocurrency exchange, new information has emerged regarding the involvement of global superstar Taylor Swift in the exchange’s sponsorship deals. Contradicting earlier reports, it has now been revealed that Swift did, in fact, sign a contract with FTX, despite initial reservations about potential issues with unregistered securities.
The New York Times Report
The revelation came to light in a recent report by The New York Times, which focused on NFL quarterback Tom Brady’s relationship with FTX. Adam Moskowitz, a lawyer involved in a class action lawsuit against FTX’s celebrity endorsers, had previously claimed that Taylor Swift had declined the deal due to concerns about unregistered securities. However, Moskowitz now admits that he had no insider information on Swift’s discussions with the exchange. Sources cited by The New York Times confirmed that after six months of negotiations, Swift eventually put pen to paper and signed the agreement with FTX.
FTX had approached Taylor Swift in the spring of last year, offering a staggering $100 million sponsorship deal, as reported by the Financial Times. The deal would have included sponsorship of Taylor Swift’s highly anticipated The Eras Tour, which commenced in the spring and is currently sponsored by Capital One. Despite potential reservations, Swift went ahead and signed the agreement, only for FTX’s CEO, Sam Bankman-Fried, to later backtrack and break the deal. Swift’s representatives have not yet provided a comment on the matter.
Start of the Downfall
FTX’s downfall began in November when the exchange failed to meet the withdrawal demands of its users. Coindesk’s investigative report revealed that FTX had utilized customer funds to invest in its co-owned trading firm, Alameda Research, ultimately leading FTX to file for Chapter 11 bankruptcy. Court-appointed FTX CEO John Ray III described the collapse as an “utter failure of corporate controls at every level of an organization.”
While FTX’s demise was primarily attributed to fraudulent activities, the crypto industry has faced increasing scrutiny regarding unregistered securities. Last year, Securities and Exchange Commission (SEC) Chair Gary Gensler suggested that the majority of crypto tokens could be classified as unregistered securities.
The saga surrounding FTX and Taylor Swift’s involvement highlights the challenges faced by both celebrities and cryptocurrency platforms in navigating a rapidly evolving industry. As the fallout continues, the crypto sector awaits further developments, and the legal implications for FTX’s celebrity endorsers remain uncertain.