The 2022 “Crypto Bowl,” then and now

It’s hard to believe it’s been just a year since cryptocurrency ads made a splash in the Super Bowl, because a whole lot has gone down (and down and down) in crypto since then.

Marketplace’s Meghan McCarty Carino got journalist and book author Jacob Silverman on the line to look back at the ads from eToro, Crypto.com, Coinbase and FTX in the 2022 “Crypto Bowl.” They might not have aged so well.

The following is an edited transcript of their conversation after reviewing the commercials.

Meghan McCarty Carino: Do you remember seeing these ads in real time?

Jacob Silverman: I do. Yeah, I was at home. And I was texting with my co-author Ben McKenzie, actor and writer, who was at the Super Bowl. And I complained to him over text like, “Oh God, they’re doing the ‘Fortune Favors the Bold’ thing again,” and being very grumpy about it all.

McCarty Carino: I mean, I think it’s safe to say FTX [was] probably the biggest explosion since we saw these ads last year. But I mean, did any of these companies kind of make it through the last year unscathed?

Silverman: No. EToro, the first one we saw, they’re still around, which is something to be said in this crypto market. They’re based in Israel, they kind of offer a variety of financial products, but definitely crypto is a big part of what they do. They wanted to go public in the U.S. for a while via a SPAC, you know, the special purpose acquisition companies. It turns out the [Securities and Exchange Commission] basically denied them permission to go public. They haven’t made the inroads into the U.S. market I think they were hoping for. And that was what that commercial, I think, was sort of supposed to celebrate and announce was, “Hey, we’re going public in the U.S. We’re here now.” Crypto.com, they’ve had a lot of layoffs, like most of these companies. They’ve managed to say solvent, which is really saying something. It turns out that the CEO’s past company kind of collapsed under sordid circumstances. So they’re still here, but they are definitely beleaguered.

McCarty Carino: And then what about Coinbase?

Silverman: Coinbase is the only publicly traded company of this group. And so we get a little bit more insight into how they’re doing and their financials. They’re both suing the government on a couple issues, like on behalf of that crypto mixer that was shut down. They were offering to put out information to their users so you could see who your political representative was and how they’ve stood on crypto. So they’ve been involved in sort of a lot of these kinds of crypto political and culture wars, I would say, that have been going on. On a more material level, they’re losing hundreds of millions of dollars per quarter. And you know, people do need Coinbase to succeed because they are supposed to be this model of how a regulated crypto exchange that’s based in the U.S., that’s covered by American law and traded on U.S. markets, can succeed. And right now they are kind of struggling. They’ve also laid off a bunch of people.

McCarty Carino: So as we watched all of these ads together in succession, what are the kind of messages that come through to you? And in hindsight, what did that moment mean?

Silverman: It’s really interesting because crypto asset prices, we can now say, in hindsight, they peaked in November of 2021. Exchange volume in terms of the amount that people were trading peaked before that, in May of 2021. So this was sort of the last burst, in some ways, of the hype, of the real boom, before things really started to collapse in April and May of 2022, that spring. People didn’t, I think, really understand the problems that lay ahead in terms of fraud, overleverage, the decline in prices and people really losing interest and how messy would all be just a few months later. So it kind of seems like crypto’s last party, and no one really knows it.

McCarty Carino: And, as you noted, you know, these commercials are really not sort of giving you any sense of what these companies do, what crypto markets are. The message is really sort of, “Don’t miss out.” It’s this FOMO thing, you know, everyone’s doing it. This is how you get money, that’s what you want.

Silverman: Yeah, and I think that’s always been a tough thing for crypto to explain itself to, really — I mean, people talk about what’s the use case? And you hear things about payments or remittances or things like that. But there still isn’t a solid, concise, one-sentence use case for crypto that is as easy to say as, you know, Facebook connects you with your friends or Uber lets you order a cab. But they never do it for crypto. It’s just supposed to be the next big thing.

McCarty Carino: Yeah. Can you draw a line between the vision that these companies were promoting a year ago and where things have ended up?

Silverman: A year ago, we were still hearing the story that crypto was sort of liberating, that it was more progressive somehow. The summer before there had been a Spike Lee commercial that was casting crypto, and bitcoin in particular, as liberation from the big banks. So some of that sensibility still remained. But really, by the time we get to the Super Bowl, it’s more I think about people getting rich and “FOMOing” their way into all this. You have the [non-fungible token] boom going on, again very short-lived. But there was still the sense that there was kind of free money out there, and that it was all a party and you just had to go and grab it. And that the number would keep going up, even though people didn’t realize that it was already going down and wouldn’t be coming back.

McCarty Carino: What about the celebrities that appeared not just in these ads, but in, you know, many other ads earlier and between then and now? Have there been any repercussions for them?

Silverman: Yeah, there have been some lawsuits already, and there’s some, there’s a class-action lawsuit involving FTX and some of the celebrity promoters. I think Larry David is named in that. You know, how many of these lawsuits will actually end in some sort of monetary settlement, much less go to trial? I don’t know, a lot will probably be dismissed. But there’s going to be a lot of litigation, there already is. In a more prominent case, Kim Kardashian was cited and reached a million-dollar settlement with the SEC for not defining her promotion of a cryptocurrency. So there is a lot of potential here for celebrities to sort of take a reputational hit because a lot of them promoted the equivalent of penny stocks, if not worse, some kind of fraud, and either they were naive or they just, you know, took bad advice or whatever else. And some of them will be sued and may have some financial penalty to pay at some point. Either way, I think it doesn’t look very good. And I think also, it doesn’t look very good that there hasn’t been any contrition really out there, you know? Maybe that’s a legal precaution, no one wants to say that they messed up or that they’re sorry, but regular people really did get hurt. And a lot of them got hurt because they believed the hype, and they believed the marketing and they liked the people who were selling it to them.

McCarty Carino: The 2022 Crypto Bowl often gets compared to the dot-com Super Bowl in 2000, when there were all these dot-com ads, after which a number of those companies went bust. Does this seem like an apt comparison?

Silverman: I can see why people make that comparison, and certainly, in, like, this boom-and-bust cycle, yes. But I feel like people tell that story because they want to say hey, something came out of that dot-com era, notably Amazon.com, I believe, and Yahoo is still around, though it’s no longer independent. You know, perhaps there will be one or two of these crypto companies from last year’s Super Bowl who will endure, and certainly there was a lot of junk in the first dot-com boom and a lot of absurdity, just like there is here in crypto. But I still fall back on the idea that the use cases haven’t been properly argued. It hasn’t been made to seem essential to people in the last year. It’s become, I think, actually just more of a cautionary tale and something that people are a little jaded about now or cynical about because there isn’t that one clear winner that is doing something with crypto that, “Hey, maybe I do need to trust them and get in on this thing.” I don’t think that feeling is really out there. And I think it shows in the numbers of users.

McCarty Carino: And I mean, these crypto ads have sort of an implicit call to action to invest maybe without completely understanding the landscape that may be more harmful than, you know, enticing you to buy your dog food from Pets.com.

Silverman: Right, right. And, you know, I think that’s the difference too, and that’s also why celebrities might be a little more implicated here. You know, it’s one thing if you’re promoting some website or a dog food or a membership that you can cancel. But it’s another thing when you’re promoting a volatile financial instrument that is not very well regulated and that could go to zero, people took loans out on or people bought on margin, things like that. It’s really a lot more precarious and potentially dangerous to someone’s finances than simply making a one-time bad purchase, and people aren’t just promoting some product, they’re leading someone into a casino.