24-year-old finance influencer Sebastian Ghiorghiu aims to teach the public about economic success and wealth, famously saying, "If you're a guy in your 20s and you don’t have a Lamborghini, you should actually sit down and have like a serious discussion with yourself as to why you don’t have a Lambo." Understandably, this disillusioned and tone-deaf comment caused an outcry. Lamborghini models range from around £155,000, but for people like Ghiorghiu, this is "so incredibly easy" and is considered 'chump change'. Ghiorghiu credits his success to crypto, where he states he made $10 million, NFTs, where he made $1.5 million in 17 minutes, and drop shipping, bringing in $2k a day. His lavish lifestyle is splashed over social media, broadcasting his luxury car collection, and he is currently constructing a $2.6 million mansion in Arizona.
Although Ghiorghiu’s story is respectable, this new breed of alpha-hustling crypto men that are emerging on social media can encourage those with limited disposable income to blow their savings on schemes that are not guaranteed success. For instance, Ghiorghiu's primary source of income, drop shipping, is often regarded as a scam, so much so that Michigan's attorney general has issued consumer warnings on this scheme, encouraging the public to be wary of whom they purchase from online. Drop shipping is often associated with suspicious e-commerce sellers that mark up and sell products to Western companies with the use of social media and Shopify to legitimize the product and justify the increased rate. When drop shippers receive orders, they send the products directly to the buyer from Chinese sites such as AliExpress and make a profit without making or touching the product. As simple as this process seems, many face low profit margins, thousands in debt, and no control over the supply chain.
Alongside financial success, many self-help influencer gurus follow an "alpha hustler" mindset, typically consisting of hitting the gym and beating their personal bests, following restrictive diets, idolizing Andrew Tate, and abstaining from porn while hopping on podcasts to talk about how women are losing their modesty and respect within society. This growing framework of becoming the 'ultimate alpha' by prioritizing wealth and self-improvement is dominating social media at an alarming rate and is setting unrealistic standards for men to become the next Jordan Belfort and Tommy Shelby. Want to become like these men? Simple; there are countless videos about making $1M from $1k' and the 'easiest ways to make money in a 45-minute video. Although influencers like Ghiorghiu are declaring drop shipping an underrated goldmine, the rise of NFTs, otherwise known as non-fungible tokens, has taken the finance world by storm. Considered unique digital assets such as art, music, and games, NFTs are a cryptocurrency used for transactional purchases and can be interchanged with other NFTs, money, and currencies such as Bitcoin.
NFT meets YouTubers
YouTuber Logan Paul hopped on the NFT bandwagon with ventures such as the now stagnant Liquid Marketplace, and the failed Dink Doink scheme. Despite Paul's turbulent journey with NFTs, Paul allegedly made millions of dollars at the expense of investors and players from the Bitcoin game CryptoZoo. Advertised as a game that even kids should get involved in, CryptoZoo could 'probably be even more relatable and universal than Pokémon,' as stated by Paul. Players are able to purchase and breed NFT animals for 0.285 Ethereum (approximately $340 today), which would increase in value over an extended period. The player can breed hybrids, generate rarer animals, and sell them to accumulate more zoo coins, resulting in more money. Unknowingly, the use of the cryptocurrency Ethereum was never deemed usable, and it could not hatch the NFT eggs that were purchased, causing players significant losses of up to $500,000.
Since its launch in September 2021, players have invested thousands of dollars, some in six-figure amounts, in hopes of increasing the value of their animals and getting a bang for their buck. On CryptoZoo’s one-month anniversary, developers announced that they were splitting from CryptoZoo and working on a new app, ZOO Labs, after allegations of Logan’s team failing to deliver on promises such as tokens and a $1 million payment. Despite this red flag, players were still anticipating payment from their eggs that were to hatch in November, only to be met with generic stock images of animals.
Alongside Paul’s false promises, other CryptoZoo founders were found in their own webs of lies and deceit. Eddie Ibanez was exposed for falsely claiming that he attended MIT and was employed by the CIA, and the final founder, known as CryptoKing, partook in a campaign that would drastically decrease the value of NFTs. The three founders purchased discounted $ZOO tokens before its launch; however, CryptoKing purchased $200,000 worth of tokens from five accounts, twice as much as Paul, which increased his investment but tanked the value of the coin to a mere $40 million. Prior to the $ZOO launch, another token was developed, doubling the money of those who owned the first token; in this case, it was the founders.
Documents reveal there were around 2 trillion tokens available, of which a quarter was reserved for 'development, marketing, and founders,' which could not be sold for six months. After six months, 10% would be unlocked each month. Interestingly, the coins the founders had purchased before the official launch would not be under restrictions and could be sold freely. Other rules included 'No selling until the $200 million market cap and don’t impact the market more than 3%. And not impact the market more than 10% in a day.' Otherwise considered a crime of market manipulation, Logan avoided this penalty by urging founders to not use their tokens, as revealed in a group chat.
While these "restrictions" were detrimental to players who invested in the game, Paul and CryptoZoo made over $6 million, while Ibanez made $1.7 million. Several investors have made substantial losses as they cut ties with CryptoZoo. Oddly enough, CryptoZoo’s terms of service prohibit users from suing the company; however, a lawsuit has since been filed against Paul that said his involvement was "super minimal," containing allegations of fraud, breach of contract, negligence, and payment for those who lost thousands due to CryptoZoo.
The main lesson: tread wisely
Although Paul has since pledged to renounce his stake and refund holders around $1.3 million, other celebrities have also used their platforms to promote crypto schemes. Kim Kardashian was fined $1.26 million after unlawfully promoting such organizations and exploiting the trust of their followers in moneymaking services that can cause detrimental financial loss in the long run. Since crypto has lost its influence in wider society and NFTs that were previously worth millions are now deemed worthless, it has been a lesson for many that the moneymaking schemes flaunted by multimillionaire influencers are not guaranteed forms of success, no matter how appealing their social media lifestyle appears to be.