Reality TV star Kim Kardashian has paid $1.26 million to the U.S. Securities and Exchange Commission to settle charges relating to her promotion of the EthereumMax digital token.
According to an SEC press notice, the “Keeping Up With the Kardashians” celebrity did not disclose a $250,000 payment for promoting EthereumMax. Part of Kardashian settlement is that cannot promote cryptocurrency for three years.
Kim Kardashian posted promotional content to her Instagram fans in 2021. With close to 74 million Twitter followers and 331 million Instagram followers, Kardashian has one of the biggest social media followings.
Floyd Mayweather Jr., a professional boxer, also endorsed EthereumMax, a product unrelated to the Ethereum network. Investors in EthereumMax filed a lawsuit against Mayweather and Kardashian in January. Influencers should know the rules of promotions wether it be crypto or lipstick. If someone is paid to talk about a product or service, the influencer must let their audience know that the promotion is “paid”. Perhaps doing this could have avoided SEC charges.
“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 Chairman Gary Gensler said in a tweet.