In Brief:
- Instagram banned Mark Cuban-backed @NFT account for breaching regulations.
- The account promoted multiple NFT initiatives without even disclosing that it’ was a sponsored post.
- Mark Cuban has since then been removed from the founder position of Leverage Game Media.
Instagram has taken down the business tycoon Mark Cuban-backed @NFT handle with 1.7M followers due to repeated rule violations.
Twitter user @topshotfund revealed in a thread of tweets that @NFT “is promoting a shadowy cabal of scammy copypasta NFT projects without proper disclosures, thus taking serious advantage of the less informed.”
@topshotfund explained that in a previous couple of weeks, he had friends reaching out to him about new NFT initiatives that he had not heard of. He began by investigating what they all had in common.
When he came across the @NFT Instagram handle, he discovered that they promoted the initial introduction to NFTs to its followers. He discovered that they monetize on a daily basis by promoting these projects without disclosing that they are advertisements.
Advertisements on social media must be disclosed in simple language such as with #ad or #sponsored tags, according to the FTC’s social media influencer guidance.
He went on to say that these shady NFT projects looking for legitimacy would buy phony followers, pay influencers, and pass it off as natural and organic interest.
“This account was disabled following repeated violations of our policies, and it won’t be reinstated,” a spokesperson for Instagram parent company Meta stated.
The Twitter user shared a screenshot of a spreadsheet that tracked the ROI for 36 NFT initiatives promoted by @NFT. In most cases, the floor price of the NFT was much lower than the “mint price,” or the original price of the token.
The @NFT account charged up to $100,000 for each sponsored post. The $100k price was confirmed by topshotfund where he shared a screenshot of a DM conversation with the @NFT handle.
Aaron Avruskin, the co-founder of Leverage Game Media who handles the Instagram account stated, “We apologize for any misunderstandings, and we will add additional layers of transparency in what we present to our community moving forward.”
Later on, Leverage Game Media updated their website showing that Mark Cuban has been removed from the founder position. Recently the Shark Tank investor hit headlines when he revealed that 80% of his investments are in cryptocurrency. Cuban went on to say that he is most interested in DAOs right now.
