#NotFinancialAdvice: Empowering the Federal Trade Commission to Regulate Cryptocurrency Social Media Influencers
![handle is hein.journals/eblwj16 and id is 291 raw text is: #NOTFINANCIALADVICE: EMPOWERING THE
FEDERAL TRADE COMMISSION TO REGULATE
CRYPTOCURRENCY SOCIAL MEDIA INFLUENCERS
TIMOTHY M. BARRY
Abstract: The proliferation of digital currency has only accelerated due to
the retail investor revolution at the advent of COVID-19.1 This year alone,
the number of available cryptocurrency coins has nearly doubled to
10,000.2 The massive influx of interested investors within the nascent
cryptocurrency space has inspired bad actors to take advantage of people's
goodwill. Specifically, social media influencers are using their sway to
convince their fans to invest in crypto coins that they own. Thus, when their
fans purchase the coin, the value of the cryptocurrency increases, and the
influencers can sell for a profit. Further, in certain circumstances, creators
of digital coins provide these influencers a large percentage of these coins
within the pre-sale as payment for their endorsement. Various regulatory
agencies are in dispute as to the classification of cryptocurrency. Also, no
applicable statutes or regulations specifically regulate these influencers.
Therefore, content creators can act with impunity. This work examines the
cryptocurrency market and the current regulatory patchwork developed by
the various relevant federal agencies. Moreover, it proposes a temporary
solution to prevent social media influencers from maliciously benefiting at
the expense of their followers. The Security Exchange Commission (SEC)
and Commodity Futures Trade Commission (CFTC) are currently
jockeying to be the agency that regulates the cryptocurrency space.
However, the Federal Trade Commission (FTC) should oversee social
media influencer endorsements of digital currencies. Thus, this Note
proposes that the FTC expand its disclosure rules' purview to require social
media influencers to disclose if they have received payment for their
endorsement of a cryptocurrency. This change would allow consumers to
know social media influencers' stake in an endorsement. Additionally,
knowing they would need to disclose this information may have a chilling
effect on influencers endorsing risky or potentially malicious alternative
cryptocurrency coins.
'Bianca Britton, Inside the Wild West of Cryptocurrencies and Social Media
Influencers, NBC NEWS: TECH NEWs, (July 21, 2021, 5:00 AM),
https://www.nbcnews.com/tech/tech-news/wild-west-cryptocurrencies-social-
media-influencers-rcnal469 [https://perma.cc/AZ5V-TRTJ].
21d.](ViewImageLocal?handle=hein.journals/eblwj16&div=14&collection=&method=preview&ext=.png&size=3)
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#NotFinancialAdvice: Empowering the Federal Trade Commission to Regulate Cryptocurrency Social Media Influencers
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