The consumer watchdog group Truth in Advertising (TINA) said it put seventeen high-profile celebrities on notice on Monday for promoting NFTs without appropriate disclosures.
TINA says it sent letters to prominent figures who have promoted NFTs on social media, including Gwyneth Paltrow, Eva Longoria, Floyd Mayweather, Tom Brady, DJ Khaled, Snoop Dogg, and Paris Hilton.
Targeted NFT collections include the Bored Ape Yacht Club, World of Women, and Autograph collections.
The group says the letters remind the celebrities that they must clearly disclose any material connection to the NFT companies that they are promoting, citing longstanding Federal Trade Commission (FTC) rules.
Non-fungible tokens, better known as NFTs, are cryptographically unique tokens linked to digital (and sometimes physical) content, providing proof of ownership.
This is not the first time TINA has taken celebrities to task for shilling NFTs. In June, TINA legal director Laura Smith sent letters to the agencies representing Justin Bieber and Reese Witherspoon claiming the pair engaged in deceptive marketing and undisclosed endorsements for the NFT collections the InBetweeners and World of Women, respectively.
Other celebrities the group sent letters to include Jimmy Fallon, Eminem, Logan Paul, Floyd Mayweather, and Gwyneth Paltrow.
Some NFTs have become high-value or “blue chip” status symbols, with many celebrities changing their Twitter profile pictures to their favorite JPEG or posting images to their Instagram accounts.
In the first quarter of 2022, before the onset of the bear market, the NFT market generated more than $12 billion in trades, according to DappRadar.
“The bottom line is celebrities who promote NFTs generally aren’t helping improve the financial literacy of their fans and followers,” TINA says. “And while some of these celebrities are able to take risks due to their massive wealth, many vulnerable consumers don’t have that luxury.”