Instagram Influencers Sued by Investors for Falsely Promoting Crypto Tokens
Instagram influencers Kim Kardashian and American boxer Floyd Mayweather have been sued by investors, accusing celebrities of falsely promoting crypto tokens to mislead investors.
The lawsuit, filed by a New York resident who bought EMAX tokens and lost money, is proposed to be filed as a class action in federal court in Los Angeles on Jan. 7, according to the report from Reuters on Jan. 11.
In June last year, Kim Kardashian West posted an Ethereum-related network project-related story on her Instagram story with 228 million followers.
Kim Kardashian West shared a cryptocurrency called “Ethereum Max token” in the story she posted. The post was not financial advice, but Kim Kardashian West labelled it with hashtag #AD beneath, indicating that this post was charged.
Mayweather promoted EthereumMax on his boxer shorts during his June fight with YouTube star Logan Paul.
The lawsuit reads:
"The company's executives, collaborating with several celebrity promoters ... made false or misleading statements about EthereumMax through social media advertisements and other promotional activities."
The company’s EthereumMax was also named in the lawsuit. EthereumMax said in a statement:
"The deceptive narrative associated with the recent allegations is riddled with misinformation about the EthereumMax project."
Last Sept. 7, British financial watchdogs were wary of investors’ cryptocurrency investment risks introduced by well-known influencers like Kim Kardashian West.
Chairman of the Financial Conduct Authority Randell stated that it is not that this particular token is a scam, saying that:
"But social media influencers are routinely paid by scammers to help them pump and dump new tokens on the back of pure speculation. Some influencers promote coins that turn out simply not to exist at all."
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