Texas Regulator’s Investigation on Celebrities who Endorsed FTX

Tom Brady, Steph Curry, who previously endorsed FTX, are reportedly being probed by Texas regulators. The investigation by Texas regulators is for looking at whether endorsements violated securities laws. And this investigating disclosures made to retail investors.

Wonder! how the second largest crypto exchange, FTX, became bankrupt overnight. This uncertain happening not only shook the belief of crypto investors but also loosen their trust and the concern to hold their assets under any crypto exchange.

An Investigation by Texas Regulators

Two sports celebrities, Tom Brady and Steph Curry and the other major endorsers of the now-bankrupt FTX, are under investigation. As the director of enforcement for the Texas State Securities Board recently announced that state regulators are investigating multiple celebrity endorsers who ever endorsed the FTX trading platform.

This investigation is an effort to determine whether securities laws were violated by Brady, Curry and others while doing the promotion of FTX and cryptocurrency.

Joe Rotunda, Director of Enforcement at the Texas State Securities Board, said in a recent interview with Bloomberg, that “We are taking a close look at them. Though the stars’ endorsements aren’t the most immediate priority, they’re still a focus in the regulator’s larger probe into FTX’s collapse.”

“There are a couple different layers to peel away to get down to it,” Rotunda added.

It must be noted that for all those celebrities who endorse crypto firms, the recent FTX collapse was the loudest lesson. Still, before the collapse, the US Securities and Exchange Commission (SEC) was cracking down on plugs without proper disclosures. The Texas examine serves as a reminder that state securities laws might also apply.

Although investigation from state-level financial authorities may be less high-profile as compared to the SEC investigation, it can lead to significant fines. Additionally, Federal watchdogs often probe similar issues and have worked with states on some of the similar cases.

The Texas regulator is taking a close look at exactly what was being promoted under the FTX investigation and finding the answer whether the celebrities were encouraging US investors to engage with a certain trading platform or products directly, as stated by Mr. Rotunda.

And before the collapse of FTX, the regulator said it was investigating whether the firm violated its securities laws by offering yield-bearing crypto accounts to US residents.

Furthermore, Mr. Rotunda recently shared a tweet along with his official email address, that states “If you’re a client of FTX_Official and you live in Texas, please reach out to me. We want to hear your story.”

However, the representatives for Brady, Curry, and other celebrities didn’t immediately respond to requests for comment, nor FTX responded.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing