Kim Kardashian and Floyd Mayweather are accused of participating in a crypto scam related to the EthereumMax cryptocurrency.
Kim Kardashian and boxing star Floyd Mayweather are accused of deceiving investorsby promoting a little-known cryptocurrency called EthereumMax to their millions of social media followers.
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A class action lawsuit filed last Friday in the U.S. District Court for the Central District of California accuses those behind EthereumMax and celebrities who promoted the cryptocurrency of colluding to artificially inflate the token’s value. The lawsuit says this was done through “false or misleading statements” in social media posts.
Kim Kardashian caused a stir a few months ago when she made an Instagram post promoting the EthereumMax token. Are you guys into crypto????“, Kardashian wrote. “This is not financial advice, just sharing what my friends told me about the Ethereum Max token!”.
Kim Kardashian included the hashtag #ad in the post, implying that she was paid to promote the crypto.
Meanwhile, Floyd Mayweather also promoted EthereumMax after the crypto was accepted as payment for tickets to a boxing match, a move that, according to the lawsuit, sharply increased trading volumes.
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Mayweather also promoted EthereumMax at a major bitcoin conference in Miami. Floyd Mayweather does not appear to have disclosed any payment for promoting the token.
The lawsuit alleges that plaintiff Ryan Huegerich, a New York resident, and other investors who purchased EthereumMax tokens between May 14, 2021, and June 17, 2021, suffered losses as a result of Kardashian and Mayweather's misleading statements.
EthereumMax has lost about 97% of its value since early June, leading some investors to label it a “pump and dump” scam, where fraudsters attempt to increase the price of an asset through false or misleading statements.
It is worth noting that EthereumMax “has no connection” to ether, the second largest cryptocurrency, although according to the lawsuit, the similar name appears to be an attempt to mislead investors into believing that the token is part of the Ethereum network.
A spokesperson for the EthereumMax project denied the accusations of crypto fraud, stating that the lawsuit was “full of misinformation.”
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However, this is not the first time that celebrity names have been mentioned in crypto scams.
In 2018, Floyd Mayweather was accused of a controversial crypto crowdfunding method. Mayweather paid over $600,000 in a settlement with the SEC, without admitting or denying the regulator’s findings.
In September 2021, Charles Randell , chairman of the UK’s Financial Conduct Authority, cited Kim Kardashian’s Instagram ad for EthereumMax and warned about crypto scams. Randell said he couldn’t say whether EthereumMax was a scam, but commented that “ social media influencers fraudsters to help them with pump and dump scams may be being paid by .”
Source: CNBC
