Can the Super Bowl Sell a New Generation of Investors on Crypto?
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This year's Super Bowl is a showdown between the Bengals, Rams and... crypto companies.
Between cheering on your favorite team and passing the chips and guac, expect to hear a lot of crypto chatter at your viewing parties thanks to companies forking over big bucks for a few seconds of advertising.
Crypto exchanges Crypto.com and FTX will have commercials airing during the Super Bowl, and FTX has even teased that its ad will include a chance at winning actual Bitcoin. The crypto exchange Coinbase has snagged a spot during the game too, and Canadian exchange Bitbuy will have an advertisement running in Canada, The Wall Street Journal reported. Those precious seconds don't come cheap: Some 30-second Super Bowl ads reportedly cost up to $7 million this year.
Cryptocurrency's popularity has recently skyrocketed, and with these Super Bowl ads, big players in the market continue to try to make digital currencies like Bitcoin more mainstream. The crypto market cap hit $3 trillion at the end of 2021 before prices plummeted earlier this year. Buying Bitcoin and Ether is now as easy as pulling up the Venmo app or trading stocks on Robinhood, and no one will stop talking about non-fungible tokens (NFTs).
The arrival of all of these crypto ads during the Super Bowl — always one of the most-watched events of the year, often celebrated as much for the commercials as the action on the field — could help legitimize the industry and increase its popularity even more, experts say.
“It’s an inflection point for the industry," says Nick Casares, head of product at Polyient, an investment group that focuses on virtual economies.
'More legitimization' for crypto
Cryptocurrency is complicated. Money has a whole guide explaining the ins and outs of how it works, and if you don't fully understand what crypto is or if it actually fits into your investment portfolio, you're not alone.
But advertisements broadcasted to millions of viewers during such a social event could start to change that, says Derek Rucker, a professor of marketing at the Kellogg School of Management at Northwestern University.
“You can imagine at Super Bowl parties where a few people are watching and one person knows about crypto, all of a sudden you get people talking about it," Rucker says.
Crypto prices have a tendency to rise when more people are talking about them and get intrigued enough to invest. Meme coins like Dogecoin and Shiba Inu have seen their prices soar based almost solely on internet hype.
One very important aspect of these Super Bowl ads is that not only will tons of people see them, but those viewers know that other people are seeing them and learning more about cryptocurrency, says Hanna Halaburda, an associate professor at NYU Stern School of Business. Crypto enthusiasts can then point their skeptic friends to Super Bowl ads and say "look, this is legit."
"It is going to lead to more legitimization," Halaburda says.
The ads will likely bring more people to the crypto market and — based on the often nonsensical way crypto prices often move — could bring up prices, she adds.
The downside? "People are going to be paying less attention to risks."
The risks of crypto aren't going anywhere
Sure, seeing Matt Damon in a Crypto.com advertisement saying "fortune favors the brave" (even if it was considered "cringe") or Tom Brady in a FTX commercial asking a bunch of people if they want "in" on crypto gets viewers talking about digital assets. But that doesn't mean they're investments everyone should consider.
Crypto is still an emerging asset class and is highly volatile, Casares says. Bitcoin's price, for example, reached an all-time high of $68,000 in November before plunging to nearly half that over the next two months. Cryptocurrencies also aren't regulated in the same say stocks and bonds are, making their future super uncertain.
It’s the responsibility of a marketer to advertise accurately and deliver on what they advertise, Rucker says, adding that he'd be surprised if the Super Bowl crypto ads have misleading messages because "that gets you into a whole pot of hot water."
Even so, don't assume that if the game's commercial breaks are filled with celebs touting the advantages of crypto that you should run to buy Bitcoin.
“A smart investment is an educated investment," says Tally Greenberg, head of business development at Allnodes. So do your research and only invest what you can lose, she adds.
Financial advisors tend to say that if you are going to invest in cryptocurrency, you should treat it as a long-term investment, and don't invest more than 5% of your overall portfolio (at the most).
"The risks are not any less just because Matt Damon is putting his face on it," Halaburda says.
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