Crisis PR for Crypto: How to Handle Media Backlash

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” Warren Buffet

In the high-stakes world of cryptocurrency, reputations are built over time but can be shattered in an instant. The crypto space is not only defined by market volatility but also by the rapid spread of narratives — both positive and negative. When a crisis hits, companies must act swiftly and strategically to control the narrative, mitigate damage, and rebuild trust.

Crisis communication in crypto presents unique challenges. News travels at lightning speed, amplified by social media and deeply engaged communities. Regulatory scrutiny adds another layer of complexity, making missteps even more costly. The way a company responds in these critical moments can mean the difference between resilience and irreparable damage.

Strategies for Effective Crisis PR Management in Crypto

1. Prepare a Crisis Communication Plan: A robust crisis communication strategy should be in place before a potential issue arises. This plan should outline how to respond to different types of crises, assign roles to team members, and include key messaging. For instance, companies like Coinbase and Binance have been known to have predefined protocols in case of regulatory issues or service outages. An example of this can be seen in Coinbase’s response to a service outage on February 28, 2024, when Bitcoin soared past $63,000, and some users saw zero balances. Coinbase quickly updated its status page and CEO Brian Armstrong addressed the issue on X, assuring users their funds were safe while explaining the outage was due to a traffic surge (Source: Coinbase Status Page, https://status.coinbase.com/incidents/2024/02/28) This also means having an in-depth understanding of the industry and any potential issues that could trigger public concern, regulatory scrutiny, or operational disruptions, such as market volatility, security breaches, or compliance.
2. Act Quickly and Transparently: Speed is vital when managing a crisis. Offering a prompt and transparent response can help control the narrative and minimize the spread of misinformation. For example, when the decentralized exchange Uniswap faced backlash for alleged illegal activity on its platform, they promptly released a statement clarifying their stance and how they were addressing the issue. (Source: Uniswap Labs Blog, https://blog.uniswap.org/fighting-for-defi)
3. Engage with Your Community: Open lines of communication can foster trust, especially within the passionate crypto community. For instance, when the popular blockchain platform Solana faced criticism after a recent advertisement was pulled due to controversy, the management engaged directly with users on X to explain their decision and the steps taken to rectify the situation. Engaging in meaningful conversations can often turn detractors into advocates.(Source: CryptoSlate, https://cryptoslate.com/solana-co-founder-apologizes-for-controversial-ad-targeting-marginalized-groups/)
4. Utilize Influencers and Advocates: In crypto, influencers may carry significant weight. Collaborating with trusted figures to convey your message can amplify your voice and lend credibility. Binance has utilised influencers during crises to provide insights and clarifications about their platform’s status.
5. Monitor and Analyze the Situation: Continuously monitor media coverage and public sentiment to adjust your strategies accordingly. Tools for tracking social media mentions such as Muckrack, Agility PR and even a simple Google alert with keywords set up and sentiment analysis can provide insights into how your message is resonating with your audience.

Turning a Potential Crisis into Opportunity: Solana’s Proactive PR Response

While the crypto industry has faced several PR disasters, it’s how companies handle these moments that ultimately shapes their reputation. One such instance was Solana’s recent advertising campaign. The advertisement was abruptly pulled following backlash over its gender controversy messaging. The ad in question “America is Back — Time to Accelerate,” quickly garnered over 1.2 million views. The video featured a man in therapy who wants to focus on technological progress but is encouraged by his therapist to focus instead on things like gender identity and pronouns. In the video, the therapist suggests that the man create a “new gender” to resolve his “rational thinking syndrome.” This scene, in particular, was viewed as tone-deaf and divisive, which prompted a strong response from viewers.

When the platform faced criticism after an advertisement was pulled due to backlash, it had the potential to escalate into a significant PR crisis. However, instead of allowing the issue to fester, Solana’s management took a decisive and transparent approach.

In response to the backlash, they quickly addressed concerns, clarified the intentions behind the ad, and reaffirmed their commitment to the values of their community. The team used social media to engage directly with users, explaining the reasoning behind their decision and the steps taken to rectify the situation. This proactive response helped mitigate long-term damage, showcasing the importance of managing a crisis with authenticity and timely communication.

By owning the situation and engaging openly with their community, Solana avoided a potential PR disaster. In the fast-paced crypto world, where misinformation can quickly spiral out of control, the ability to respond with transparency, accountability, and empathy is crucial. Solana’s ability to turn this situation around is an excellent example of crisis PR done right — addressing issues head-on while maintaining trust and credibility with their audience.

Areas that typically receive the most attention for crisis PR in crypto:

Regulatory Scrutiny and Uncertainty:
The crypto industry’s rapid growth has led to increased regulatory oversight, which can create uncertainty and fear among investors and the public.

Platform Failures and Hacks:
Instances of crypto exchanges or projects failing, or being hacked, can erode public trust and lead to significant PR damage. One recent example is the hack from Bybit which saw hackers take over $1.5 billion in tokens, which has been labelled the biggest crypto’s biggest heist of all time.

Price Volatility and Market Crashes:
The inherent volatility of the crypto market can lead to dramatic price swings, causing financial losses for investors and raising questions about the stability of the industry.

Scams and Fraud:
The decentralized nature of crypto can make it vulnerable to scams and fraud, which can damage the reputation of the entire industry. Remember the Bitconnect scam in 2021 where victims lost $2.4 billion. Efforts have been made to recoup funds to victims however according to Blockworks the restitution of $17 million to 800 victims from over 40 countries, more than a year after the exchange’s top promoter pleaded guilty to wire fraud charges.

Lack of Transparency and Misinformation:
The complexity of crypto can lead to misunderstandings and misinformation, which can be exploited by bad actors. And in crypto there have been a slew of bad actors i.e.Terra USD’s Tai Mo Shan was forced to pay $123 million to investors for negligently misleading them about the stability of the Terra USD. The SEC’s order also found that Tai Mo Shan acted as a statutory underwriter in distributing LUNA crypto assets, which were offered and sold as securities.

Community Engagement and Mismanagement:
Failing to engage with the crypto community or mismanaging communication can lead to negative PR. Often in times of disaster or crisis companies are quiet instead of being proactive with communication which is always beneficial. The recent rapid response from Solana regarding an ad that came across as tone deaf is proof that when a situation arises the best thing to do is to address it and to do so openly with the leaders of the organisation visibly taking accountability and addressing the communities that are at the core of their businesses.

Conclusion

Navigating media backlash in the ever-evolving crypto landscape is no simple feat. The industry’s history of crises — from exchange collapses to regulatory battles — has shown that a single misstep can erode years of trust. However, companies that respond with transparency, strategic communication, and community engagement can turn challenges into opportunities for growth.

A well-prepared crisis PR strategy is no longer optional — it’s a necessity. Crypto brands that embrace proactive communication, swift action, and accountability will not only survive crises but emerge stronger. In a space defined by volatility and scrutiny, resilience isn’t just about weathering the storm; it’s about building lasting credibility in an industry that demands trust.