The US Securities and Exchange Commission (SEC) announced today it is charging Kim Kardashian with “unlawfully touting” a cryptocurrency to her 225 million Instagram followers last year. Kardashian was paid $250,000 for the social media shoutout. Despite Kardashian including “#AD” at the bottom of her post promoting an altcoin called EthereumMax on June 12, 2021, the SEC explained that investors were not made fully aware of the sponsored content’s origins. The celebrity, reportedly worth $1.4 billion, is being fined approximately $1.27 million in repayments and penalties.
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The SEC has pushed for closer federal regulation of crypto and other virtual assets for years, and Kardashian’s brief, murky partnership is just one of the cases they have shined a light on. “This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors,” SEC Chair Gary Gensler said via an official press release. “We encourage investors to consider an investment’s potential risks and opportunities in light of their own financial goals.”
“ARE YOU INTO CRYPTO??? THIS IS NOT FINANCIAL ADVICE BUT SHARING WHAT MY FRIENDS JUST TOLD ME ABOUT THE ETHEREUM MAX TOKEN,” Kardashian posted to Instagram last year, around the same time as other paid EthereumMax endorsers, including boxing champion Floyd Mayweather, Jr. and former NBA star Paul Pierce, posted similar messages on social media. Both Mayweather and Pierce are involved in similar legal issues stemming from the sponsorship deals.
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If you hadn’t heard of EthereumMax (EMAX), the altcoin pushed by Kardashian last year, until today—you aren’t alone. As recounted by the SEC, the owning company’s “numerous direct statements that the EMAX tokens would rise in value” via “touting future deals and relationships that would ‘drive value’” haven’t amounted to literally anything. At current rates, a single EMAX token is worth roughly $0.00000000467 at the time of reporting: a 7-percent bump over yesterday’s valuation thanks to the recent headlines.