YouTubers Face $1B Class-Action Lawsuit Over Alleged FTX Crypto Fraud Promotion

Popular YouTubers and content creators were named "defendants" in a new class-action lawsuit that sought these social media influencers to be held responsible for allegedly promoting the massive FTX crypto fraud and asked for more than $1 billion in damages.

The lawsuit filed against so-called "FTX influencers," led by Edwin Garrison at the United States District Court Southern District Of Florida Miami Division earlier this week, alleged that the "defendants" or "influencers" "promoted FTX crypto fraud without disclosing compensation."

YouTubers and so-called NFT influencers Kevin Paffrath, Graham Stephan, Andrei Jikh, Jaspreet Singh, Brian Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, Erika Kullberg and Creators Agency LLC were named as defendants, aside from sports superstars like Shaquille O'Neal and Tom Brady, who were previously named.

"Though FTX paid Defendants handsomely to push its brand and encourage their followers to invest, Defendants did not disclose the nature and scope of their sponsorships and/or endorsement deals, payments, and compensation, nor conduct adequate (if any) due diligence," the court filing read.

The lawsuit also alleged that these so-called "influencers" "present themselves as real-life consumers who share authentic and valuable information with their followers."

The Moskowitz Law Firm, representing the plaintiffs, said in the court filing that these plaintiffs, who hailed from various countries, "purchased an unregistered security from FTX in the form of a YBA [yield-bearing account]" and eventually suffered damages because of purchasing unregistered security.

The lawsuit alleged that the defendants promoted the crypto business to benefit themselves financially.

Ben Armstrong, one of the named "defendants" in the lawsuit who is also known on YouTube and other social media platforms as BitBoy Crypto, commented about the suit and said he is filing a countersuit. "The lawyers on this case can't possibly be more stupid. I've never had contact with anyone at FTX and never even had a reflink," he wrote in a tweet.

"Show me you are dumb without telling me you are dumb," BitBoy Crypto tweeted, adding, "I'm going to roast these Low IQ plebs and their lawyers."

Further, Armstrong claimed that he has "never spoken with anyone at FTX or as a marketing agent acting on their behalf. Not once."

He also mentioned that "the allegations against me are 100% false and it will be extremely easy to provide evidence of this."

BitBoy Crypto recently attracted the attention of the Shib Army, the fierce and loyal member of the Shiba Inu community, when Shytoshi Kusama, the community's lead developer, reacted to his claims and openly fired shots against him on Twitter.

After BitBoy Crypto suggested that Kusama is fake, Shib Armies swarmed to defend their beloved lead developer.

One of them was the content creator who uses the Twitter handle @LucieSHIB. "Just listening to @Bitboy_Crypto's video can actually damage your mental health," the Shib Army fondly called Lucy within the community tweeted, adding, "I hope his low-class videos come with proper research and a mental health disclaimer."