Kim Kardashian is one of three celebrities being sued by EthereumMax cryptocurrency investors.
Boxer Floyd Mayweather Jr., basketball player Paul Pierce, and the currency’s inventors are among the other accused.
Celebrities According to a complaint filed in California, Kim Kardashian, former NBA star Paul Pierce, and boxer Floyd Mayweather exploited their celebrity to promote a new cryptocurrency as part of a bigger plot to deceive investors while benefitting for themselves.
According to the lawsuit, the celebrities worked with EthereumMax to “misleadingly promote and sell” the cryptocurrency.
EthereumMax stated that it denies the charges and looks forward to learning the truth.
Despite its name, EthereumMax has no legal or commercial ties to the Ethereum cryptocurrency.
According to the lawsuit, the digital coin’s inventors, Steve Gentile of Connecticut and Giovanni Perone of Florida, subsequently sold their EthereumMax holdings “for substantial profits.” According to the lawsuit, Gentile and Perone “marketed the EMAX tokens to investors so that they could sell their piece of the float for a profit.”
“The deceptive narrative associated with the recent allegations is riddled with misinformation about the EthereumMax project,” a company spokesperson said. “This project has prided itself on being one of the most transparent and communicative projects in the cryptocurrency space. We dispute the allegations and look forward to the truth coming out.”
A slew of celebrities have endorsed cryptocurrency. Matt Damon, Paris Hilton, Jamie Foxx, Ashton Kutcher, Gwyneth Paltrow, and Dennis Cole, better known as Ghostface Killah of Wu-Tang Clan, are among the celebrities who have openly backed several digital currency.
The lawsuit, filed on behalf of New York investor Ryan Huegerich, does not specify to whom Gentile and Perone sold their EthereumMax or for how much. The complaint also does not specify if Kardashian, Mayweather, or Pierce benefitted from their cryptocurrency holdings.
Nonetheless, Huegerich’s attorneys claim EMAX was a “pump and dump fraud,” with celebrities promoting the token to raise its price, after which Gentile and Perone liquidated their holdings.
According to CoinMarketCap data, EMAX debuted in May of last year with an initial trading volume of $16.1 million. According to the lawsuit, that figure increased as a result of social media posts by Kardashian and Pierce, as well as incentives by Mayweather, such as signed boxing gloves, ringside tickets, and discounts to individuals who purchased fight tickets online using EMAX Tokens. EMAX’s trade volume peaked at around $108 million at one point.
“However, this meteoric rise did not last long, and EthereumMax began to deflate immediately after Kardashian’s post,” court documents state. “On July 15, the price of the EMAX token hit its all-time low: $0.000000017 per unit, a 98% drop from which it has not been able to recover.”
On Wednesday, EthereumMax was trading at the same $0.000000017 price.
Kardashian, Pierce, Mayweather, and the EthereumMax founders are being sued for complicity, unjust enrichment, and other California state law crimes. The lawsuit does not specify how much money Huegerich put in EthereumMax or how much compensation he seeks.