On February 2, Twitter user Space Cowboy (@Topshotfund) rocked the space with his thread about the recently-suspended twitter account, quickly bringing shady and unethical practices to light. The thread spread like wildfire, with community members scrambling to share additional information and demanding a response from Cuban.
Space Cowboy wasted no time detailing how “normie” friends had brought questionable NFT projects to his attention for advice, and how they all seemed to have found the projects through the verified NFT Instagram account; which had amassed 1.7 Million followers since it’s creation in Spring 2021 (the Instagram account continued to thrive until it was finally suspended on February 3,while the previously-Verified Twitter account was suspended back in January). The account was monetizing on a daily basis by promoting nearly-identical projects with suspicious tactics and NEVER using the legally-required “#ad” disclosure.
The thread continues, pointing out how the Instagram account bought followers, paid influencers and conveyed them as organic, and also embellished the backgrounds of the artists involved.
Space Cowboy STILL wasn’t done though, continuing on with proof of a conversation with an alleged member of the @NFT promotional team, asking for $100K to promote a project (which was actually first reported by Coffeezilla back in December). Then they ran the numbers, breaking down the 36 promoted projects, finding four outright rugs, 70% of the projects sitting at or below mint price, and more shocking information (you can see the full chart and breakdown here).
According to Rolling Stone, a representative from Meta and Instagram gave only a brief explanation of the accounts suspension, saying “This account was disabled following repeated violations of our policies, and it won’t be reinstated,” while also pointing to part of the platform’s policies that prohibits “attempts to sell, buy, or exchange accounts, site privileges, or product features.” (As per the FTC's social media influencer guidance, advertisements on social media must be disclosed in “simple and clear language,” such as with #ad or #sponsored tags.)
The magazine also reached out to Mr. Cuban for comment via email, but he only confirmed that he was an investor and “not involved with operations” while steering the conversation to @NFT co-founders Jason Falovitch and Aaron Avruskin. When pressed about the alleged shady practices brought forth by Space Cowboy, Mr. Avruskin ignored all specifics with his statement, mentioning the “tireless work” that goes into building “the largest community on social media for all things NFT,” adding that the account had partnered with “many successfully acclaimed projects in the space.”
However, he did admit that not all projects went as planned. “We regularly provide our community, on a daily basis, with a variety of tips to help them understand the space, with a clear focus on consumer safety, and always encouraging them to DYOR [do your own research],” he wrote. “We apologize for any misunderstandings and we will add additional layers of transparency in what we present to our community moving forward.” Both Falovitch and Avruskin are also co-founders with Cuban of Leverage Game Media - a hybrid investment and advertising firm that has also deleted it’s Instagram account.
The team behind the @NFT account quickly went into damage control, hosting an “Open Discussion” on Twitter Spaces. In the discussion on Wednesday night, Avruskin swore they were “doing their due diligence on all projects,” and vowed to “immediately cease all ads” on the (now-suspended) Instagram account, and to “try to be better going forward.” Which seems disingenuous, as Coffeezilla proved they never even asked about his fake project, just saying “show us the money” and asking for $25K per post, with a five-post minimum. Avrusin also told Decrypt, “We apologize for any misunderstandings, and we will add additional layers of transparency in what we present to our community moving forward.”
Eric Spivak, the CEO of Urconduit, hosted a follow-up Twitter Space where he lambasted Avruskin for a “total lack of accountability, a lack of ownership, and a lack of an unbiased stage” while simultaneously corroborating Space Cowboy and Coffeezilla’s allegations of the $100K price tag detailing separate payments to @NFT of $25K and $50K.
On Friday, Cuban reiterated to numerous outlets that “I’m an investor, I Don’t operate the company” and added that he isn’t a co-founder. Outside of these initial responses, Mr. Cuban has been silent on the issue, refusing questions and ignoring comments on all social platforms. Leverage Game Media’s website was also updated to remove Cuban from the list of founders.
As the NFT space continues to grow into the mainstream, it will be vitally important that community members continue to shed light on bad actors and protect newcomers from predatory celebrities.
If you're reading this, you are on a good path to sourcing unbiased information.
Also do your own thorough research and NEVER make decisions based solely on a promotional account.
*Space Cowboy, Mr. Cuban, Mr. Falovitch, Mr. Avruskin, and Mr. Spivak were all contacted for comment, but did not reply by the time of publication.
