{"id":2327,"date":"2022-01-13T14:01:07","date_gmt":"2022-01-13T13:01:07","guid":{"rendered":"https:\/\/ancstockinvestments.com\/blog\/?p=2327"},"modified":"2022-01-13T14:06:56","modified_gmt":"2022-01-13T13:06:56","slug":"kim-kardashian-is-being-sued-over-the-ethereummax-cryptocurrency","status":"publish","type":"post","link":"https:\/\/ancstockinvestments.com\/blog\/2022\/01\/13\/kim-kardashian-is-being-sued-over-the-ethereummax-cryptocurrency\/","title":{"rendered":"Kim Kardashian is Being Sued Over the EthereumMax Cryptocurrency"},"content":{"rendered":"\n
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Last June Kim Kardashian shared a post on social media promoting a little-known cryptocurrency token called EthereumMax.<\/p>\n

\u201cAre you guys into crypto????\u201d she wrote on Instagram<\/a>, where she has more than 200 million followers. \u201cThis is not financial advice but sharing what my friends just told me about the Ethereum Max token!\u201d<\/p>\n

Seven months later, EthereumMax has lost about 97%<\/a> of its value, and celebrities are in legal hot water for promoting the speculative currency. Kardashian is one of several public figures being sued<\/a> for misleading investors about the token, along with boxer Floyd Mayweather and former professional basketball player Paul Pierce.<\/p>\n

Also Read: RBI Sets Up a Fintech Department for Crypto, Mobile Payments<\/a><\/h5>\n

What the lawsuit alleges<\/h2>\n

A class-action lawsuit<\/a> (pdf) filed on Jan. 7 in the US District Court for the Central District of California accuses several celebrities as well as EthereumMax\u2019s co-founders of making \u201cfalse or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities.\u201d Ryan Huegerich, who purchased the company\u2019s EMAX tokens last year, filed the complaint on behalf of himself and other investors who bought the digital assets in May and June of 2021.<\/p>\n

The complaint alleges misleading promotions and celebrity endorsements artificially increased interest and pricing of the digital tokens while they were available for public trading, \u201ccausing investors to purchase these losing investments at inflated prices.\u201d<\/p>\n

In addition to Kardashian\u2019s Instagram endorsement, EthereumMax was hyped by former Boston Celtics player Pierce on Twitter<\/a>, as well as Mayweather, who promoted the token at a boxing match with YouTube star Logan Paul last June. Spectators could pay to attend the event using the cryptocurrency, which caused EthereumMax\u2019s trading volume to more than double in the days leading up to the match, the complaint alleges.<\/p>\n

EMAX tokens are blockchain-powered, and promise investors<\/a> 3% of all transactions. These particular tokens have no connection<\/a> to Ethereum, the second largest cryptocurrency, the complaint alleges.<\/p>\n

Celebrities face increased scrutiny for promoting crypto<\/h2>\n

The swift rise and fall of EMAX tokens\u2019 value led some regulators to accuse Kardashian and other celebrities of engaging in a \u201cpump and dump\u201d scheme, meaning they hyped speculative digital assets while the share price was high before selling them off.<\/p>\n

\u201cThere is no shortage of stories of people who have lost savings by being lured into the crypto bubble with delusions of quick riches, sometimes after listening to their favorite influencers, ready to betray their fans\u2019 trust for a fee,\u201d Charles Randell, the head of Britain\u2019s Financial Conduct Authority, said in a speech criticizing Kardashian\u2019s actions in September.<\/p>\n

Celebrities from actor Matt Damon to TikTok star Charlie D\u2019Amelio to football player Tom Brady continue to promote cryptocurrency<\/a> in spite of the considerable risk investors take on by buying digital tokens such as EMAX. This is not the first time Mayweather has faced legal consequences for engaging in such promotions; the boxer reached a settlement<\/a> with the US Securities and Exchange Commission in 2018 for failing to disclose payments he received for promoting investments in Initial Coin Offerings.<\/p>\n

A representative for EthereumMax told the Wall Street Journal that Kardashian\u2019s post \u201cwas simply intended to raise awareness of the project and its utility.\u201d<\/p>\n<\/div>\n