Three celebrities are being sued after they promoted a digital currency that has turned out to be worthless. Boxer Floyd Mayweather, socialite Kim Kardashian, and former NBA star Paul Pierce are being accused of misleading investors to purchase Ethereum Max (EMAX) and then dumping it on them as its value plummeted.
The lawsuit, filed in the Central District of California, alleges that the three conspired with the founders of the project in a web of deceit that left the investors holding tons of worthless EMAX tokens.
Ethereum Max was one of the thousands of projects built on the Ethereum blockchain, otherwise known as ERC-20 tokens. While being conveniently evasive about the project, the founders made references to all the right buzzwords such as NFTs, smart contracts, DeFi, and yield rewards to drum up support for the project.
However, out of all this, EMAX’s biggest weapon was celebrity endorsements. The endorsements started with Mayweather becoming connected with the project as EMAX sponsored his heavily publicized boxing match with YouTuber Logan Paul. In a press release in May, the project said it was the exclusive currency for purchasing tickets to the match. Mayweather even rocked a branded EMAX t-shirt to a BTC event in Miami around the same time.
Former NBA star and TV sports personality Paul Pierce also got on the EMAX bandwagon, using his social media to pump the project. After ESPN fired him for non-related issues, he took to Twitter to tell the sports media giant off, claiming he made more with EMAX in a month than he did with ESPN in a year.
The biggest campaign was by socialite and reality TV star Kim Kardashian. She took to her Instagram to tout the project, and with over 210 million followers on the platform, it was by far the biggest digital currency promotion campaign ever, at least by sheer reach.
“A few minutes ago Ethereum Max burned 400 trillion tokens—literally 50% of their admin wallet giving back to the entire E-Max community,” she said in her post, which she labeled as an ad.
Ryan Huegerich, an investor from New York who purchased the EMAX token between May (when Mayweather started touting the token) and June (when Kim posted her ad for the token), believes the three celebrities colluded with the founders to dump on unsuspecting investors. In addition to suing the three celebrities, he is also suing the entity behind EMAX, which is still unknown.
“Defendants touted the prospects of the company and the ability for investors to make significant returns due to the favorable ‘tokenomics’ of the EMAX Tokens,” he argues in his lawsuit.
“In truth, Defendants marketed the EMAX Tokens to investors so that they could sell their portion of the Float for a profit,” Huegerich added.
Since hitting its highs in May, the token has dipped by over 97% to date, and at press time, it was trading at a mere $0.00000001695. And with its trading volume at a mere $147,000 in the past 24 hours, it would appear that activity in the EMAX ecosystem has all but dried up.
Ethereum Max has yet to respond to the lawsuit. The three celebrities have also yet to address the latest scandal. While this rollercoaster may be new to Kim and Pierce, Mayweather is no stranger to digital currency promotions gone wrong.
As CoinGeek reported, the boxing icon was caught up in the Centra Tech scam ICO that ended with close to a decade behind bars for the founder. Together with music producer DJ Khaled, they settled with the SEC for $750,000 in 2018.
Follow CoinGeek’s Crypto Crime Cartel series, which delves into the stream of groups—a from BitMEX to Binance, Bitcoin.com, Blockstream, ShapeShift, Coinbase, Ripple,
Ethereum, FTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.
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