List of Flash News about token launch due diligence
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2025-11-10 00:32 |
Crypto Influencer Sponsored Posts Pattern Exposed: 5 Trading Red Flags and Compliance Checks Backed by FTC and SEC
According to @boldleonidas, many sponsored crypto posts now follow a scripted pattern—introducing an unknown project, asserting quality, comparing it to a trusted project, showing infographics, adding several scripted paragraphs, and ending with a paid-collaboration note at launch—indicating advertising rather than independent research (source: @boldleonidas). The FTC requires clear and conspicuous disclosure of material connections in endorsements, so missing or ambiguous labels such as ad, paid partnership, or sponsored constitute a compliance red flag for traders (source: U.S. FTC Endorsement Guides, 16 CFR Part 255, 2023). The SEC warns investors not to rely on influencer or celebrity promotions of ICOs or tokens because endorsements can be paid and misaligned with investor interests, elevating fraud and misrepresentation risk (source: SEC Office of Investor Education and Advocacy, Investor Alert on Celebrity Endorsements of ICOs, 2017). Empirical studies find coordinated promotional campaigns are linked to short-lived price spikes and negative subsequent returns consistent with pump-and-dump dynamics, highlighting event-trading risk around paid launches (source: Hamrick et al., The Economics of Cryptocurrency Pump-and-Dump Schemes, 2018; Mirtaheri et al., Analyzing Cryptocurrency Pump-and-Dump Schemes, 2019). Before trading promoted launches, verify disclosure, review total supply and distribution, lockups/unlocks, and who controls liquidity and treasury to reduce asymmetric information and liquidity risks (source: SEC Investor Bulletin: Initial Coin Offerings, 2017; SEC Framework for Investment Contract Analysis of Digital Assets, 2019). For execution, avoid illiquid pairs, use limit orders, and size positions conservatively around promotions due to elevated volatility and slippage documented in pump events (source: Hamrick et al., 2018; Mirtaheri et al., 2019). |