The UK Financial Conduct Authority singled out Kim Kardashian for being part of a possible scam involving cryptocurrencies
The famous billionaire and influencer Kim kardashian it is investigated currently by the british government. The Financial Conduct Authority (FCA) of that country accused the businesswoman of being part of a possible crypto fraud by promoting the speculative cryptocurrency Ethereum Max (EMAX), a token that rose in value more than 1,370% in just two weeks.
Charles randall, FCA director, He reported that Kardashian posted an Instagram story in June recommending the mysterious cryptocurrency that has no connection whatsoever with the Ethereum network.
If you take into account that the influencer has 251 million followers on InstagramRandall explained that this was about “the financial promotion with the largest audience reach in history“.
Kardashian’s Instagram post
“Are you into crypto? This is not financial advice, but I want to share what my friends just told me about the Ethereum Max token! A few minutes ago Ethereum Max burned 400 trillion tokens – literally 50% of his administration portfolio giving it back to the entire E-Max community “, the story could read.
Other celebrities like boxer Floyd Mayweather and former basketball player Paul Pierce also promoted Ethereum Max.. In fact, according to a press release, Ethereum Max was “the Exclusive Cryptocurrency (sic) accepted for online ticket purchases” for the Mayweather vs. Logan Paul that could be seen in the pay per view mode.
Did Kim Kardashian commit any infraction while promoting Ethereum Max?
Randall acknowledged that Kim Kardashian complied with Instagram rules by stating that what she was promoting was a paid ad. The businesswoman clarified that she had no obligation to explain or give further details about what Ethereum Max is.
“Of course, I can’t tell if this particular token is a scam. But scammers routinely pay social media influencers to help them push and discard new tokens based on pure speculation. Some influencers promote resulting coins. it simply does not exist at all “, detailed the director of the FCA.
“There are many stories of people losing all their savings when they are drawn into the cryptocurrency bubble under the illusion of getting rich quick,” added Randall. “And sometimes this happens thanks to influencers who are willing to betray their fans in exchange for money.”
According to the CoinDesk portal it is speculated that Kim Kardashian could have made between $ 300,000 and $ 500,000 (or more) promoting the EMAX.
What is Ethereum Max or EMAX?
“Ethereum Max, not to be confused with Ethereum, was a speculative digital token created a month before (from Kim Kardashian’s post) by unknown developers, one of hundreds of such tokens that fill crypto exchanges,” explained the FCA official.
Not much could be known about this cryptocurrency that was launched on May 14 with a capitalization of u $ s16.11 million and a price of u $ s0.00000005875, according to data from CoinMarketCap. It is primarily traded against Ether, the native currency of the Ethereum network on Uniswap, a decentralized exchange that allows anyone to list a token.
On May 30, the EMAX had already achieved a market value of almost US $ 118 million, a figure that represents an increase of 632% in just two weeks.. A day earlier, it peaked at u $ s0.000000863, a 1,370% increase compared to its launch price from u $ s0.00000005875 per unit.
However, on July 15, the bullish streak was cut and the crypto began to lose value, reaching its all-time low of u $ s0.000000017 per unit, a 98% drop from which it has failed to recover. On August 1, its market capitalization fell to u $ s157,423, less than one hundredth of your initial capital.
According to the British authority, this digital currency is not covered or regulated by the body, which represents a risk for investors.
“We at the FCA have repeatedly warned about the risks of holding speculative tokens. To be clear: these tokens are not regulated by the FCA. They are not covered by the Financial Services Compensation Plan. If you buy them, you must be prepared to lose all your money “, stressed the director of the FCA in a note on the Entrepeneur site.