Research has revealed that 30% of TikTok videos on crypto investments share wrong messages. The videos sport crypto-related hashtags such as investing, trading, and advice.
Also, the researchers discovered that TikTok influencers promoting Bitcoin and digital asset investments had recorded billions of views on their videos cumulatively.
Crypto Influencers On TikTok Post Misleading Information
TikTok is a popular video-based platform where many people search for information besides Google. But dappGambl researchers have discovered that many digital influencers post misleading information about digital investments on TikTok.
dappGambl analyzed more than 1,161 TikTok videos and discovered that one out of every 10 warned the viewers of crypto investment risks. The rest failed to add disclaimers about the risks. Also, the researchers found that 47% of content creators only focus on making money through the services they push to their viewers.
Further, dappGambl researchers also discovered that one out of every three misleading TikTok videos focused on Bitcoin. All the videos with crypto-related hashtags have recorded over 6 billion views on the platform.
These influencers aim to convince uninformed and unsuspecting viewers to spend money on crypto assets even though they’ll lose their funds.
Notably, most viewers of Tiktok videos are the younger generation, not well-equipped to decipher malicious intentions. As such, these influencers easily deceive them and sometimes their parents with dubious returns on crypto investment.
Crypto Influencers Pose Financial Risks To Investors
One of the dangers of sharing unvetted or misleading information with billions of viewers is they’ll believe what the influencers say, given their trust in them. This was one reason regulators mandated influencers to disclose the payments they receive for promoting products or services.
However, some mainstream influencers failed to adhere to it pushing unsuspecting investors into massive losses. For instance, influencers such as Soulja Boy, Kim Kardashian, and Jake Paul faced the US Securities and Exchange Commission for promoting crypto projects.
Kim Kardashian was sued for promoting EthereumMax (EMAX) and paid $1.26 million in penalties. Soulja Boy and others were sued for promoting SafeMoon, a BNB Chain-native token that became a Ponzi scheme.
Another recent case was a $1 billion lawsuit against Binance, its CEO Changpeng Zhao, and three cryptocurrency influencers for allegedly promoting unregistered securities. The case filing revealed that millions of investors could be eligible for damages from their actions.
While TikTok influencers may not have a broader reach with their content, they still pose financial risks to investors on the platform.
Unfortunately, most users of TikTok and other video-sharing platforms usually rely on the number of views and likes on a video to rate it as authentic. As such, top influencers easily convince them to invest in any product.
But given their findings, the researchers now advise new and veteran investors to vet every investment opportunity thoroughly before committing funds.
Featured image from Pixabay and chart from Tradingview