Athletes and celebrities who have embraced cryptocurrency by taking all or part of their compensation in bitcoin have faced losses in recent weeks as the digital currency crashes.
Bitcoin is an inherently risky asset and has given investors a wild ride over the past year. Bitcoin hit a record high of $69,000 in November but has since retreated by nearly half as the Federal Reserve gears up to raise interest rates and traditional blue-chip stocks also struggle. Still, that has not stopped some of the rich and famous from embracing the digital assets, and many have undoubtedly lost out since bitcoin and other cryptocurrencies began to slide sharply downward over the past several weeks.
BITCOIN WORTH LESS THAN HALF WHAT IT WAS IN OCTOBER AS MARKETS DROP
“You’re concentrating your wealth into an asset class that’s volatile,” said Ryan Firth, founder of Mercer Street Company. “It’s basically like getting paid in your company’s stock. … If the company goes down, your fortune goes down too.”
Firth told the Washington Examiner that people who are taking all or part of their salary in bitcoin are running the risk of losing a significant percentage of their investment without doing anything due to the volatility of the cryptocurrency market.
Trevor Lawrence
Trevor Lawrence, quarterback for the Jacksonville Jaguars and No. 1 overall pick in the 2021 NFL draft, made waves last April when he partnered with cryptocurrency app Blockfolio and announced that he would place his signing bonus into an account with the company. His signing bonus was worth more than $24 million.
“Trevor Lawrence is the future of professional football and cryptocurrency is the future of money, so the partnership was a no-brainer,” said Sam Bankman-Fried, CEO of Blockfolio.
Saquon Barkley
New York Giants running back Saquon Barkley also announced a foray into the cryptocurrency space last year. Barkley, who signed with the Giants in 2018, makes more than $10 million per year in endorsements, marketing, and sponsorship deals — he said those funds would be going into bitcoin instead of his bank account.
Barkley expressed his desire to attain generational wealth and said with higher inflation, he thought investing in Bitcoin would be a smart move.
“You see inflation, you see how high it is right now, and you learn that you can’t save yourself to wealth,” Barkley said. “That’s why I’m going to be taking my marketing money in bitcoin.”
Francis Suarez
Francis Suarez, the mayor of Miami, said in November that he would take his next paycheck “100% in bitcoin.” Suarez has said he hopes to expand cryptocurrency use and acceptance in his city and attract tech companies to South Florida.
“For any city to survive and thrive, we need a knowledge-based economy,” the young technocrat told Bloomberg.
Eric Adams
Eric Adams, the newly installed mayor of New York City, took a page out of Suarez’s book and, in an apparent attempt to one-up the Miami mayor, announced that he would take his first three paychecks in cryptocurrency.
Adams, who was sworn into office earlier this month, announced Friday that he converted his first biweekly paycheck into both bitcoin and ethereum. After converting his check, the value of the cryptocurrencies tumbled, and Adams is believed to have lost more than $1,000 as the two cryptocurrencies declined by double digits since Friday morning.
Odell Beckham Jr.
Odell Beckham Jr., a wide receiver for the Los Angeles Rams, announced in November that in a partnership with the payment service Cash App, he would be taking his salary with the NFL franchise in bitcoin. The one-year contract is reportedly worth up to $4.25 million with a base salary of $750,000.
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“It’s a NEW ERA & to kick that off I’m hyped to announce that I’m taking my new salary in bitcoin,” the NFL star said on Twitter at the time.
Several other celebrities and athletes have also taken the plunge into the cryptosphere, a trend that will likely become a more common occurrence as cryptocurrencies become increasingly well known and accepted as an asset class.
