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In October 2022, the SEC fined Kim Kardashian $1.26 million for promoting the cryptocurrency project EthereumMax (EMAX) to her 225 million Instagram followers. Kardashian did not disclose that she was paid $250,000 to promote the project. One British financial regulator at the time believed it to be one of the largest financial promotions in history. But it was also for security asset, making it illegal. Other celebrities supporting the motion filed are Floyd Mayweather, Jr., Giovanni Perone, Paul Pierce, and Jona Rechnitz.
Investors who acquired $EMAX tokens claimed they lost money after believing celebrity influencers about the worth of the cryptocurrency inflate the value of the $EMAX tokens.
However, there has been a revised attempt to hold Kim Kardashian and other celebrities for the promotion of the cryptocurrency project. Kardashian , Floyd Mayweather, and other personalities are trying to convince a judge to rule out the revision of the lawsuit. The defendants contend that the additional claims pursue the same core notion that the court previously rejected.
As per the lawsuit, the EthereumMax team collaborated with celebrities to sell EMAX tokens to investors. However, investors are referring to the project as a “pump-and-dump” scheme.
Additionally, the plaintiffs claimed in the initial court petition, which Scott + Scott Attorneys At Law filed on January 7, that Mayweather ,Kardashian, and former NBA star Paul Pierce had failed to disclose that they had been paid to promote EthereumMax.
As on December 8, Michael Fitzgerald concluded , that investors had missed to prove that CEO and promoters acted in their self-interest rather than planning to mislead other investors. And the magistrate’s statement claimed that a class-action lawsuit was dismissed because ‘it is unclear whether the investors who sued noticed the promotion’ and they had not specified when theyhad seen the promotions.
To conclude the whole allegation , moreover Kim Kardashian agreed to pay a $1.26 million settlement on October 3 over the allegation with U.S. Securities Exchange Commission (SEC), That she failed to disclose her $250,000 paid promotion by the EthereumMax.