How Influencers Hype Crypto, Without Disclosing Their Financial Ties

Some of the projects that Mr. Armstrong promoted were small experimental crypto startups that eventually ran into trouble. In those cases, he said, he too considered himself a victim.

“They are taking advantage of the novice crypto influencer who has just become popular and is trying to figure out what they should and shouldn’t do,” he said. “It’s hard to go from 12,000 followers to a million in a year and make all the right decisions.”

Mr. Paul rose to fame as a video blogger and occasional actor; youtube one time rebuked him for posting pictures of a dead body he found in a Japanese forest. Over the years, he has parlayed his internet fame into an eclectic array of business ventures, including a line of energy drinks.

Mr. Paul became interested in crypto last year when the NFT market started to grow. In a recent interview, he acknowledged that he was still learning to navigate the cryptocurrency market, even as he tried to cash in on the technology. “I’m an extreme idea person, not much of an enforcer,” he said.

Mr. Paul participated in some of the initial brainstorming for the Dink Doink project. But the company was eventually spearheaded by one of his roommates, Jake Broido, who gave Paul 2.5 percent of the tokens that were initially issued.

in a cheep last June, Mr. Paul called it one of the “dumbest and most ridiculous” cryptocurrencies he had ever come across, and distributed a video of a cartoon character singing sexually explicit lyrics. “That’s why I’m all out,” he added. She was also featured in a shaky camera video on Telegram in which he praised Dink Doink as possibly his favorite crypto investment.

The campaign was a failure, and Mr. Paul was ridiculed by YouTube critics. The price of Dink Doink floated well below a penny, before falling further in value over the summer. Mr. Paul said that he never sold his tokens or profited from the project. But he said that he regretted promoting the coin without disclosing his financial involvement. “I definitely didn’t act as responsibly as I should have,” he said.