Basketball legend Shaquille O’Neal insisted that he is skeptical of cryptocurrency despite his recent endorsement of the now-collapsed digital asset empire run by Sam Bankman-Fried.
Cryptocurrency exchange FTX filed for bankruptcy last month after users learned that the company was intertwined with sister firm Alameda Research; both were controlled by Bankman-Fried and other amateur executives working from a luxury penthouse in the Bahamas. The entrepreneur was arrested this week by authorities in the island nation, where his companies were headquartered, as American officials unsealed criminal charges against him.
Bankman-Fried spent millions of dollars recruiting celebrities as brand ambassadors in a marketing blitz as the company became increasingly strapped for cash. O’Neal was featured in an FTX commercial as recently as June. “I’m excited to be partnering with FTX to help make crypto accessible for everyone,” he said. “I’m all in. Are you?”
The four-time NBA champion distanced himself from FTX during an interview with CNBC this week, claiming that he was not associated with the company beyond his appearance in the advertisement.
“A lot of people think I’m involved, but I was just a paid spokesperson for a commercial,” he remarked. “I have nothing to hide. If I was heavily involved, I would be at the forefront saying, ‘Hey.’ But I was just a paid spokesperson.”
O’Neal said in the commercial that he checked his FTX account daily. When asked by CNBC if he is presently bullish on cryptocurrency, he offered a one-word response: “No.”
Among the other cultural icons FTX solicited to appear in advertisements were Golden State Warriors point guard Steph Curry, celebrity investor Kevin O’Leary, Tampa Bay Buccaneers quarterback Tom Brady and his supermodel ex-wife Gisele Bündchen. The company reportedly offered singer-songwriter Taylor Swift a sponsorship deal worth $100 million because Bankman-Fried was a diehard fan. Many of the influencers are now the subject of a lawsuit claiming they participated in a “fraudulent scheme” meant to fool unsophisticated investors.
O’Leary, who said he lost the approximately $15 million in digital assets and equity he earned as a spokesperson of FTX, testified before the Senate Banking Committee on Wednesday about potential regulations on the nascent sector.
“The collapse of FTX is nothing new. While this situation is painful for shareholders, employees, and account holders, in the long run, it does not change this industry’s promise,” argued the entrepreneur, who holds investments in other cryptocurrency companies. “Enron came and went and had no impact on the energy markets. Bear Stearns and Lehman Brothers’ demise had no impact on the long-term potential of American debt and equity markets.”
The Securities and Exchange Commission has officially charged Bankman-Fried with fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy, and money laundering. A complaint from the agency alleges that he used commingled funds to make “undisclosed venture investments, lavish real estate purchases, and large political donations.” The disgraced entrepreneur, who has been denied bail due to the significant flight risk he poses, could spend as much as 115 years in prison if convicted on all counts.