Kim’s K crypto crisis: Influencer-driven coin promos add fuel to the push for regulation

Keeping up with crypto... Kim Kardashian, Floyd Mayweather, and other celebs are being sued over promoting alt-coin EthereumMax as part of an alleged crypto scam. The mysterious coin debuted in May claiming to “bridge the gap between community-driven tokens” and legacy crypto — but provided few details.

• Problem #1: EthereumMax’s misleading name. It has nothing to do with Ether, the second-largest cryptocurrency after Bitcoin.
• Problem #2: EthereumMax has crashed 98% since June, which has led to allegations it’s a “pump and dump” scheme. Think: Insiders selling everything after hyping the coin.
• Problem #3: Misleading #ad-vertising. Kim disclosed to her 250M+ Insta followers that EMax was a paid promo (FYI: she had to) but didn't discuss risks. Mayweather even accepted EMax as payment for his high-profile fight with Logan Paul.

Crypto’s Wild West… is under scrutiny. While micro-influencers increasingly promote new cryptos, celebs like Kim K have unprecedented reach. As FOMO-driven investors try to score on the $3T crypto market, a growing number of fraudsters are taking advantage. Last year, crypto crimes hit a record $14B, and scammers lured investors with trend-based coins (see: Squid Coin).

• Regulators have warned against crypto-market manipulation for years. But crypto markets and exchanges lack the controls and fraud protections of the stock market.
• US regulators are calling for coin issuers to be held accountable. SEC Chair Gary Gensler wants crypto to be regulated in the same way the SEC oversees stocks and bonds.