The reality TV personality allegedly received $250,000 for promoting the cryptocurrency without indicating she had been paid to do so, according to the US Securities and Exchange Commission. Kim Kardashian also consented to refrain for three years from promoting securities backed by crypto assets.
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What Kim Kardashian’s Lawyer Said
The lawyer said, “Kardashian fully cooperated with the SEC from the very beginning and she remains willing to do whatever she can to assist the SEC in this matter.
“Ms Kardashian is glad to have addressed this case with the SEC,” her attorney told BBC News.
"She wanted to get this matter behind her to avoid a protracted dispute. The agreement she reached with the SEC allows her to do that so that she can move forward with her many different business pursuits."
SEC on Kim Kardashian
The SEC‘s chairman, Gary Gensler, described the case as a “reminder” that a celebrity endorsement did not automatically make a product worth purchasing.
The reality TV star and businessman has agreed to comply with the SEC’s ongoing investigation, according to a statement released on Monday, and she will pay $1.26 million in fines, disgorgement, and interest.
Furthermore, it claimed that Kardashian omitted the fact that she received $250,000 in exchange for posting on her Instagram account about EMAX tokens, a cryptocurrency asset security offered by Ethereum Max.
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Gary Gensler’s Statement
“This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn’t mean that those investment products are right for all investors,” SEC Chair Gary Gensler said.
“Ms Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote investing in securities,” he said.
Why Misleading Promoted by Lawsuit
The lawsuit claimed that they had worked together in a “pump and dump” scheme to “misleadingly promote and sell” the cryptocurrency in order to raise its value before offering it to investors. At the time, Ethereum Max denied the accusations.
Despite its name, Ethereum Max is not affiliated with the cryptocurrency Ethereum in any way, either legally or commercially.
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How Much Kim Kardashian Will Pay
The federal securities laws’ anti-touting clause was broken by Kardashian, according to the SEC. Kardashian accepted the decision without contesting or confirming the SEC’s conclusions.
A $1 million fine and the forfeiture of the $250,000 money she received, plus interest, are also part of the settlement agreement.
Who Can Create Crypto Assets
A crypto coin can be made by anyone. A few pounds, a YouTube tutorial, and an interesting name are all you need.
Numerous new tokens will be introduced this month alone, each of whose developers claims their coin will be the next big thing.
Given that the product has little inherent value, marketing is essential. As in many contemporary industries, celebrities can make or break a product.
At first, it appeared that Ethereum Max’s massive investment in snagging celebrities like Kim Kardashian was paying off.
But like many cryptocurrency coins, the decline was just as abrupt as the ascent.
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Kim Kardashian Net Worth
Forbes estimates that Kardashian’s net worth is $1.8 billion. Therefore, a $1.26 million charge is equivalent to a fine of less than $100 for a typical US household, which, based on the Federal Reserve’s most recent assessment, has a net worth of around $122,000.
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