Kim Kardashian West Criticized for Promoting Ethereum Max on Instagram
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Kim Kardashian West Criticized for Promoting Ethereum Max on Instagram

1 year ago

"Influencers are routinely paid by scammers to help them pump and dump new tokens," a U.K. official says.

Kim Kardashian West Criticized for Promoting Ethereum Max on Instagram

Inhaltsverzeichnis

The UK’s Financial Conduct Authority has criticized celebrities — including Kim Kardashian West — for promoting “untested” cryptocurrencies.

Charles Randell, who chairs the City watchdog, made his remarks after the A-lister promoted Ethereum Max to her 250 million followers on Instagram.

Although she did note that her post was an advertisement, Randell expressed concerns that there might have been a lack of due diligence about the token.

CoinMarketCap data shows that Ethereum Max is currently ranked 3,168th out of all cryptocurrencies. Its current price is $0.00000002822 — and prices have fallen by 96.89% since they hit an all-time high of $0.00000092 at the end of May.

Randell said Kardashian’s post “may have been the financial promotion with the single biggest audience reach in history.” He added:

“Of course, I can’t say whether this particular token is a scam. 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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The Dilemma 

Although watchdogs like the FCA have been keen to caution investors against gaining exposure to cryptocurrencies, so far there has been little success to introduce regulations.

Randell noted that the FCA doesn’t have a remit to enforce regulations on tokens — and said their decentralized nature would mean that the projects themselves would need to seek registration or authorization. Such a scenario seems unlikely. He added:

“Action against businesses which choose not to bring themselves within the reach of an effective national regulator needs to be international, with regulators across the world working together to limit the harm.”

In the U.S., the Securities and Exchange Commission has charged a number of celebrities who backed initial coin offerings — with some receiving fines.

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