Taylor Swift: Better Crypto Due Diligence Than The SEC, Plus Integrity In Wielding Influence

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Taylor Swift (Photo by Frazer Harrison/Getty Images)

I first saw Taylor Swift perform 17 years ago. She played a free-admission show at the Mall of America while I was home from college on Christmas break.

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Swift was far from a cultural phenomenon at that point. Many people in the crowd had never heard of her. She was just a girl. There were crude comments shouted. Yet, listening to Swift sing and strum her heart out on that stage at the Mall of America, I thought, This girl is going places.

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I suppose that’s a convenient way to remember it, given what we know now about Swift’s musical career.

On the other hand, maybe I just missed my calling as a talent agent. Swift’s music has topped the charts, smashed records, and won her millions of fans.

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Honestly, I’ve lost touch with the newer music. Have still been keeping up a bit on T-Swift’s progression as a public figure though.

When Sam Bankman-Fried’s cryptocurrency exchange FTX melted down, a lot of celebrities were left looking foolish. FTX was known for its high-profile, high-dollar endorsement deals. Now some celebrities — including Tom Brady, Stephen Curry, Larry David, and Shaquille O’Neal — are facing a lawsuit accusing them of promoting an unregistered security.

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Not Taylor Swift. When the superstar was approached by FTX for a $100 million deal to sell her concert tickets as NFTs, her response was reportedly, “Can you tell me that these are not unregistered securities?”

That was a pretty astute question, as it sure appears that FTX was hawking unregistered securities. That is illegal except under very limited circumstances. Swift never endorsed FTX, and, I’d like to imagine, told them where to shove their $100 million.

Swift herself has not yet offered a public comment on these revelations (what we know about her interactions with FTX comes from discovery in the lawsuit against its celebrity endorsers). Even reading between the lines, it seems like Swift is out ahead of the Securities and Exchange Commission on this.

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Swift, based on her actions, seemed to have determined at least some of FTX’s crypto products were unregistered securities that she wanted nothing to do with. Yet, when asked six times at a congressional hearing on April 18 whether the second-largest cryptocurrency by market cap (ether) was a commodity or a security, SEC head Gary Gensler dodged the question six times. This is the guy who came into office promising more investor protections in the cryptocurrency space.

The SEC has warned about investing in crypto a bunch of times. Nobody listens to those nerds though. That’s the whole reason FTX was cozying up to all these famous people in the first place: people do listen to celebrities.

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Swift has, somewhat notoriously, worked to avoid political issues for a large portion of her career. She has been criticized for not taking strong enough political stances (and for just about everything else).

And that’s fine. It’s not like there’s some requirement that every musical artist has to proclaim a stance on all political issues. In fact, I bet most of you, even when you agree with your favorite musical artists’ political leanings, would rather hear their music than their political diatribes. Plus it’s actually kind of refreshing to see a big celebrity remain circumspect about the massive influence she wields. If only Kid Rock would exercise similar restraint.

Swift is perhaps offering something even better than loudly voicing her thoughts on crypto regulation and other issues: a good example. Rather than ask about whether their product was a scam, Swift could have simply snatched FTX’s $100 million and ran like a Supreme Court justice boarding a private jet to Indonesia.

Instead, Swift demonstrated integrity. I’ll take a musician who has shown herself to be a relatively good role model over yet another preachy, out-of-touch celebrity shouting opinions at us anytime.

A few weeks ago, I agreed to provide some background music for a staff event. One of the tunes I picked out on the ol’ guitar was “Tim McGraw,” Swift’s first single. Sorry to say that a couple of the young associates who are self-professed Swifties had never heard it, being as how they were in elementary school when the song came out.

But I remembered. That girl in the mall 17 years ago who just wanted to sing her heart out is now a woman with the strength to turn down $100 million because she thought a potential sponsor might be taking advantage of people. Calling that “admirable” doesn’t quite do it justice.

Jonathan Wolf is a civil litigator and author of Your Debt-Free JD (affiliate link). He has taught legal writing, written for a wide variety of publications, and made it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached at [email protected].

Topics

ATL Finance, Crypto, Cryptocurrencies, Finance, Finance Docket, FTX, Jonathan Wolf, SEC, Taylor Swift, Unregistered Securities