Not everyone is happy about Manny Pacquiao launching a cryptocurrency

Several celebrities have launched or backed cryptocurrencies over the past few years. However, opinions are divided about if it’s a good thing or not.

Professional boxer turned singer and Philippine senator Manny Pacquiao is the latest famous person to jump onto the cryptocurrency trend. He announced his new digital token PAC Coin recently during a concert. He is aiming to launch it together with the former Liverpool FC footballer Michael Owen and Sheikh Khaled bin Zayed al-Nahyan, a member of the Abu Dhabi’s ruling family.

And he is not the only celebrity to try to leverage cryptocurrencies. Danish tennis player Caroline Wozniacki and singer Jason Durelo announced their own currency in October 2018.

Months earlier, singer Akon launched his own cryptocurrency, named AKoin, with the ambitious vision to use it establish what he referred to as a “real-life Wakanda” in Africa, a nod to fictional country depicted in the Marvel Cinematic Universe movie Black Panther. The artist behind hits like I Wanna Love You and I Just Had Sex stated that Senegal’s president had already gifted 2,000 acres of land for the development of Akon Crypto City where the cryptocurrency would be used for most transactions.

Moreover, Ghostface Killah, the Wu-Tang Clan rapper, issued his own cryptocurrency C.R.E.A.M. in October 2017 only to suspend the sales of the currency months later after plunging by over 96%. In the end, it went from being worth $0.02 per coin at the launch to $0.0045.

Paris Hilton also made the headlines in 2017 after supporting the cryptocurrency Lydian only to see reports surface revealing how the founder of the digital token had previously pleaded guilty for domestic abuse.

It is because of examples like these that Danny Scott, CEO of CoinCorner, the cryptocurrency exchange is less than enthusiastic about celebrity cryptocurrencies.  While he appreciated their contribution, he felt that “celebrities [releasing] their own cryptocurrencies for the purpose of selling merchandise and allowing fans to connect with them is wrong on so many different [levels.]”

Pointing at AKoin and C.R.E.A.M, Scott stated that since they ”no longer seem to be running, making this a great first learning opportunity.”

“In the vague news stories around PAC, it’s explained that the purpose of the token is to help Pacquioa to connect to his fans and allow them to purchase his merchandise,” he continued. “That’s great, but what’s wrong with using social media [channels like] Twitter, YouTube and Instagram? These work pretty well for most celebrities, so why should fans have to buy PAC tokens to interact with their idol, Manny? What problem is this solving? Seems to be creating a problem rather than solving one.”

The CoinCorner CEO also expresses some concerns about how the boxer had provided few details about what platform it PAC had been built on, except that it is based on blockchain.  “I’m hoping more experts from the bitcoin industry will begin to question these projects going forward as I personally see this as nothing more than snake-oil salesmen at work,” he stated. “It’s a shame Manny Pacquiao has allowed himself to become muddled in with this as it’s most likely being sold as a dream on the blockchain, a dream that is just hot air at the end of the day.”

However, not everyone agrees. Chiedozie Hez is a cryptocurrency and FinTech consultant. “These developments further validate and also promotes cryptocurrencies,” he tells FinTech Global. “A lot of misinformation is spread about cryptocurrencies which has dampened interests worldwide but when world famous celebrities with billions of fans enter the market, a level of confidence is restored. Celebrities have reputation which they have earned and fans believe in them so this definitely means that people who would never have thought of buying cryptocurrencies will consider entering the market.

“Another key issue with cryptocurrencies is the fact that most people struggle to put a value on them. Some people have even called them magic money which doesn’t really exist. However, these celebrity cryptocurrencies are utility tokens which is backed by real products and services. Once it is clear that the currency actually has tangible value and they can afford the fans some utility, then adoption rate will increase.”

Lee Hills, CEO of blockchain regulation specialists SolutionsHub, also welcomed celebrity endorsements of cryptocurrencies. “However, it’s important that blockchain tech is treated with respect and seen as a credible, trustworthy financial vehicle,” he told FinTech Global.

“There is a danger that celebrity associations paint crypto in an unflattering light, as a novelty or get-rich-quick scheme and that can be damaging to the industry in general.”

“Owen and Pacquiao are largely respected sportsmen who have performed at the highest level and, not only that, are somewhat known for their business nous so, hopefully, their tokens will shed a welcome spotlight on the power of blockchain, rather than being a blot on the industry’s copybook.”

Copyright © 2019 FinTech Global

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