Celebrity Kim Kardashian and athletes Floyd Mayweather and Paul Pierce were named in a lawsuit for allegedly scamming their followers into investing in a cryptocurrency called EthereumMax.
As with most dramatic pop culture moments, it all started with an Instagram story.
“Are you guys into crypto????” Kim Kardashian posted to her 250 million Instagram followers last June. “This is not financial advice but sharing what my friends just told me about the Ethereum Max token! A few minutes ago Ethereum Max burned 400 trillion tokens—literally 50% of their admin wallet giving back to the entire E-Max community.” Now, Kardashian is among a slew of celebrities being sued by investors of Ethereum Max, in what is being considered a pump and dump scheme.
Also being sued are boxer Floyd Mayweather and NBA star Paul Pierce, who similarly used their social media accounts to post about Ethereum Max last spring between May and June. Ethereum Max peaked on May 31st 2021, before falling drastically over the next several weeks. The token has lost nearly 97% of its price.
The class action complaint claims that the celebrities were already paid in tokens for their sponsorships, so their posts effectively convinced thousands of Kardashian’s loyal fans to invest in something that suddenly became worthless. “In truth, Defendants marketed the EMAX Tokens to investors so that they could sell their portion of the Float for a profit.” It also alleges violations of state consumer protection laws.
Kardashian has yet to comment on her involvement in the scheme, but she isn’t the first celeb to encourage their fans to do something like this.
EMAX generated buzz last summer thanks in part to social media endorsements from celebrities like Kardashian and Mayweather, peaking at $10.55 in September. But now the cryptocurrency is trading at $1.50 as the bottom has fallen out.