The recent collapse of the NFT and cryptocurrency market has seen many experienced and amateur investors lose plenty of funds. At the beginning of the year, the crypto market seemed to be on the rise, with the Bored Ape Yacht Club NFT hype in full swing. When it peaked, celebrities and fans alike quickly jumped on the bandwagon to become early adopters, hoping to secure rare NFTs for themselves. As prices increased, the BAYC NFTs became one of the most sought-after digital products on the market at the time.
But as the crypto market turns bearish and buzz around NFTs has died down, the exclusive Bored Ape club has felt the effects of the downturn. Decrypt has reported that a class-action lawsuit was filed last week against celebrities who alleged they used their popularity to defraud investors. The lawsuit alleges that celebrities including Justin Bieber, Snoop Dogg, Steph Curry, Kevin Hart, Madonna, Serena Williams, Post Malone, The Weeknd, Gywneth Paltrow, Jimmy Fallon and Paris Hilton have all been named in the lawsuit, and is seeking damages upwards of $5 million on behalf of the plaintiffs and the putative class of “all others likewise.”
A total of 37 co-defendants were named, also including Yuga Labs management and BAYC’s celebrity supporters. The lawsuit has also named executives such as Amy Wu who previously served as a consultant and board member of ApeDAO. In a statement to Variety, a Yuga Labs spokesperson said, “In our view, these claims are opportunistic and parasitic. We strongly believe they are without merit, and look forward to proving it.” The lawsuit also names MoonPay, and claims that the crypto payment startup allegedly facilitated the endorsements.
The lawsuit detailed an elaborate scheme by BAYC, alleging conspiracies engineered by some of Hollywood’s elite to inflate the value of BAYC NFTs with celebrities. It also alleges that the elite group was secretly involved in a hidden payment scheme that was laundered through the crypto company. The suit also singles out Guy Oseary, Madonna’s longtime representative and Yuga Lab for his extensive celebrity network. The heavy pressure from celebrities, athletes and entertainers is said to have caused the value of BAYC NFT to become “artificially inflated and distorted prices”. The celebrities are said to have driven the scheme forward.
This is not the first class action lawsuit in crypto. Earlier this year, Curry, Tom Brady, Shaq and more were sued for defrauding investors with their FTX endorsement.
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