By Weston Blasi
Social media personality Kim Kardashian was fined $1.26 million by the Securities and Exchange Commission over one of her Instagram posts from 2021 that promoted an EMAX token.
Kardashian was fined for not disclosing that she was paid $250,000 for the post — she did not deny or admit to the SEC’s findings.
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The cryptocurrency she was touting in the Instagram post that went out to her 250 million followers was for EthereumMax, a company that offers ERC-20 tokens .
“It appears to be particularly easy to convince people to spend money on cryptocurrency projects,” Darren Heitner, Professor of Sports Law at the University of Florida, told MarketWatch in an email earlier in 2022, before the $1.26 million fine from the SEC was announced. “Which makes it more important for athletes and celebrities to conduct thorough due diligence on these platforms before associating themselves with the companies and do whatever they can from being viewed as merely being money-hungry and connected to a pump-and-dump scam.”
That token has plummeted in value since 2021, according to data from CoinMarketCap, and is now trading at $0.000000005468.
It’s worth making a distinction between the situation with Kardashian and other celebrities who touted crypto in recent years like Matt Damon and Larry David as those actors were featured in official ads for crypto exchanges, as MarketWatch’s Chris Matthews reported .
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Crypto markets can be extremely volatile and it’s important to make informed financial decisions when dealing with crypto.
The SEC fine comes as a “ crypto winter ” has taken shape.
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Prices for crypto like bitcoin /zigman2/quotes/31322028/realtime BTCUSD -0.39% and ether /zigman2/quotes/108573964/realtime ETHUSD +0.29% have continued to crash . Values for many cryptos are down over 70% from 2021 highs . The total market cap for all crypto nearly hit $3 trillion during parts of 2021, but is now lower than $1 trillion .
On Monday, bitcoin was trading just below $20,000 and etherum was trading just below $1,400.