Sometimes, even foresight is 20/20…
In February 2018, CNET.com ran an article titled, “Steven Seagal has a cryptocurrency now. It’s bad.”
At the time, the former action star had just become brand ambassador for Bitcoiin2Gen (B2G). Beyond this Hollywood “celebrity” endorsement, the initial coin offering (ICO) offered few details… even its founders wished to remain anonymous.
If those red flags don’t scream scam, here’s just a taste of the company’s press release announcing the endorsement (yes, it’s still online):
As a Buddhist, Zen teacher, and healer, Steven lives by the principles that the development of the physical self is essential to protect the spiritual man.
He believes that what he does in his life is about leading people into contemplation to wake them up and enlighten them in some manner.
These are precisely the objectives of the Bitcoiin2Gen to empower the community by providing a decentralized P2P payment system with its own wallet, mining ecosystem and robust blockchain platform without the need of any third party.
CNET went on to report that it was unclear what role Bitcoiin2Gen was trying to fulfill, and that its whitepaper was “dramatically light” on details.
Less than two months later, Bitcoiin2Gen received a cease-and-desist order from New Jersey for selling unregistered securities in the form of B2G. The company was already under scrutiny over the red flags CNET noted in its piece… and Seagal ended his role as brand ambassador.
Unfortunately for Seagal and B2G, a cease-and-desist order was only the beginning…
On February 27, 2020, the SEC announced the end of an investigation into Seagal’s involvement with Bitcoiin2Gen. It turns out, Seagal had been promised roughly $1 million in cash and B2G coins for his endorsement… a fact he was required to disclose to B2G investors.
Seagal reached a settlement with the SEC, which let the actor off with a $314,000 fine and bars him from promoting any kind of security—digital or otherwise—for three years. The SEC noted that its investigation of Bitcoiin2Gen’s ICO “is continuing.”
On the surface, it seems painfully obvious… no whitepaper, a random celebrity endorsement, zero information on anyone behind the offering… B2G is almost certainly a scam.
And yet Seagal is just one in a long list of celebrities fined or taken to court by the SEC for promoting questionable ICOs. (Others include Paris Hilton, Kevin Hart, and boxer Floyd Mayweather.)
Despite the red flags—flags so red, CNET called B.S. from day one—investors continue to pour their money into celebrity-endorsed ICOs like B2C, without doing any research. And in times of extreme market volatility (like today) those questionable promises can be harder to resist.
Don’t make that mistake.
If a celebrity endorsement—or any ICO—seems too good to be true, do your homework before you invest a single penny… including a look at the offering’s whitepaper. If one exists, it should give you insight into who and what you’re about to invest in.
And if Chuck Norris, Jean-Claude Van Damme, or any other Hollywood actor tries to sell you a crypto… consider yourself warned.