Tom Brady, Stephen Curry and other big names are mostly off the hook from the FTX fallout
A Florida federal judge has dismissed most of the claims against marquee celebrities and influencers who pushed the now-defunct cryptocurrency exchange FTX. Stars like New England Patriots quarterback Tom Brady, model Gisele Bündchen, Canadian TV personality Kevin O'Leary, and basketball standout Stephen Curry were among those who promoted FTX, which collapsed spectacularly in 2022, causing investors to lose billions.
A group of FTX investors claimed that the celebs should be held liable in a suit filed shortly after the exchange's collapse.
'None of these defendants performed any due diligence prior to marketing these FTX products to the public,' according to the original lawsuit.
However, in an order filed Wednesday, U.S. District Judge K. Michael Moore found that the plaintiffs failed to show that the celebrities and YouTubers named in the lawsuit had insufficient knowledge of FTX and CEO Sam Bankman-Fried's business to be held liable for promoting the exchange.
According to a New York Times report, Brady received $30 million in now-worthless stock for pitching the company in television ads and at its conference. Brady's then-wife, Gisele Bündchen, received $18 million in stock, per the report. All shares are now worthless.
Sam Bankman-Fried, also known as 'SBF,' launched the cryptocurrency exchange FTX in 2019. As the COVID-19 pandemic later boosted cryptocurrency trading worldwide, FTX rode the wave. In 2020, FTX purchased Blockfolio, the market's leading mobile news and portfolio tracking app, for $150 million. Bankman-Fried appeared as a speaker at various crypto and blockchain conferences, attracting a large following.
But in November 2022, the crypto news website CoinDesk reported on FTX's poor balance sheet and liquidity crisis. Big names such as cryptocurrency exchange Binance opted not to provide any support to FTX or Bankman-Fried.
FTX quickly collapsed, resulting in a loss of $10 billion in customer funds. This had a ripple effect on other crypto companies, throwing them into financial turmoil. Several companies with direct or indirect connections to FTX — including BlockFi, Voyager, Celsius, Genesis, and Gemini — went bankrupt in a matter of weeks. The cryptocurrency market saw its darkest period to-date, resulting in a loss of more than $1 trillion, and Bitcoin's price dropped below $18,000.
In November of 2023, a federal jury in New York convicted Bankman-Fried of fraud on seven different fraud and conspiracy charges and stealing at least $10 billion from customers and investors.
—Vinamrata Chaturvedi contributed to this article.
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