Last week, celebrities like Kim Kardashian and Floyd Mayweather were met with a lawsuit after it was discovered that they were endorsing the cryptocurrency EthereumMax to many of their followers on social media, with the coin later alleged to be fraudulent.
The class action lawsuit filed in the U.S. District Court for the Central District of California claims that multiple high-profile social media accounts made "false or misleading statements" on public posts. This lawsuit mainly occurred because these celebrities deceived their social media followers into investing in large amounts of the cryptocurrency, but left them with little to no gain in the end.
About a year ago, Kim Kardashian caused quite a commotion because she created an Instagram
What her followers didn't know was that Kardashian was in fact paid an undisclosed amount by EthereumMax, and she included hashtags such as "#ad" on the post in order to promote it. It is approximated that she was paid anywhere from $500,000 to $1 million for this paid promotion.
Many individuals suffered from financial hardship or loss because of Kardashian's and other celebrities' actions, including plaintiff Ryan Huegerick, a New York resident, as well as other investors who ended up buying EthereumMax tokens between the dates of May 14, 2021 and June 17, 2021.
In spite of the allegations that were made against Kardashian and other celebrities, however, a spokesperson for the EthereumMax project denied the truth of them, insisting that the lawsuit was "riddled with misinformation." "This project has prided itself on being one of the most transparent and communicative projects in the cryptocurrency space," stated the spokesperson. "We dispute the allegations and look forward to the truth coming out."