I hate to admit this, but I was (briefly) involved with the Ethereum Max project.
They gave me a sizable sum of cash up front, no contract, to act as a general and technical consultant. This happened less than 48hrs after I met some of the main "team" which consisted of over two dozen crypto bros and various boxing promoters, none of whom understood the most basic concepts of blockchains, transactions, currency, regulation, etc.
I was with them when they contacted Kim to shill, and I actually advised them to take a much different approach, but of course, I was ignored, and I promptly left the project about a week later.
EMAX is really the epitome of everything wrong in cryptocurrency and I'm glad to see a fraction of justice being served here. Now if only the dozens of other "team" members who were (from my firsthand perspective) equally culpable in defrauding the public could also be held accountable, that would be great.
This comment is tongue in cheek, but it's not meant to be pithy nor sarcastic — I mean this with sincerity.
Let me be the first to extend my heartfelt congratulations. You avoided the inevitable SEC enforcement action and DoJ indictment!
Thanks to your skill, moral backbone and foresight you're not spending $900/hr/head on a cadre of lawyers. That's better than how most people fare in such a scenario. So, congratulations!
However, you still need to maintain OPSEC and STFU. You've already said things in other comments that aren't the wisest things to say. I would stop right now and call a very good lawyer.
If you don't know how to find one, then call a few and ask whom they'd recommend. Zero in on the choice from there. I sincerely hope that you won't disclose any further details here or elsewhere. Especially in writing.
I can't imagine thinking that posting this on a public forum makes any sense at all. You have everything to lose by making statements like this, and nothing to gain.
As a nonlawyer I’m curious what your risk might be. You accepted money for consulting services from what is apparently some sort of fraud conspiracy? And you seem to have info the SEC would want and might feel compelled to eke out of you with a little pressure.
Your story seems to put you in the moral right. But what about the legal right? Is it time to get a quick lawyer checkup?
(I’m not implying anything. The answer may very well be a definitive “no, this is a nothingburger.”)
Kim's whole business is doing paid promotions to her Instagram followers-- typically $250k-$500k per promotion. Turns out that's illegal for securities, unless you disclose how much you got paid. If she'd added a footnote to her post, she would have been fine-- maybe something like "The brilliant folks at EthereumMax paid me $250k to bring you this message."
Such a footnote wouldn't have hurt the ad's effectiveness. There were news articles at the time warning people not to take investment advice from Kim Kardashian[1], but that didn't seem to deter people.
> illegal for securities, unless you disclose how much you got paid
Since she certainly has "people" who know this and advise her, I can only assume that they thought that doing this would reduce the effectiveness of the advertising. Someone made a judgement call (heh!) and decided that the expected fine, if prosecuted, was less than she'd make from the promotion.
How can anybody look at the 'official' Ethereum Max twitter and not see it as a sham?[1]
The problem with crypto is that your average retail user, and probably even a lot of regulators, do not understand the difference between Ethereum and Ethereum Max.
The problem with crypto is that the use cases are so limited that, to the average retail user, there simply is no difference between Ethereum and Ethereum Max. Both are mysterious digital things you buy and hope the price goes up.
Whether it's a sham or not seems to have nothing to do with it. She's in trouble for paid promotion of securities, which who the hell knows which crypto project the SEC is going to decide is a security?
> Kardashian included “#AD” at the bottom of the post in 2021, according to the SEC. Despite that, the SEC said investors weren’t made aware of her being paid for the ad.
Yes they were - not thinking a social media post with '#ad' is an ad is akin to thinking the TV ads are just made by actors that like the products.
Woah this is a pretty meaty part of the allegation because I 100% would assume that would be good enough to inform your audience that it was an add. Especially given how small a tweet is, how can you reasonably say that a consumer read the content of the tweet but did not read the #ad part?
Twitch streamers are paid to play games all the time. It was one of their large revenue streams. They very rarely if ever mention that it is an ad, but they put in their title #ad exactly like this accusation. Obviously the SEC is unlikely to care bout streamers shilling video games to children, but seems like that could be a problem in the future.
IANAL, but I believe the "#ad" requirement is from the FTC. The SEC may have a higher bar, since this is securities-related. Just like putting "#ad" on Tweet promoting medicine wouldn't fly with the FDA.
Far too often these fines are simply considered "the cost of doing business".
Worse, in many cases they agree to pay the fine without admitting guilt. It is almost like the government simply wants a cut of the action instead of discouraging it?
Tangent, but we recently had some rich guy drunk driving an e-scooter in Germany. The fine was extremely low because in most cases the court estimates how much a person makes without checking, and lowball it to ~1500€/month (it’s usually not worth researching how much someone makes and by lowballing it chances are the person won’t object). The case resulted in 30 day-fines, so 1500€.
But this guy did object the judgement. Well, the objection was overruled, but by now the court had heard of who this was. The new day fine was 2,670€ resulting in a total fine of 80,100€ :D
I don't know. It seems to me that it is a question of the purpose of the courts. Is the court there to provide a fair verdict and fair punishment or to dissuade behaviors? If it is the former why should the persons assets be considered as all. If the later why are traffic violations also not levied as apart of your net worth?
Any one who promoted this project should be branded as totally bereft of any integrity or sense of judgment, and denied any kind of platform to influence society.
There are celebrities who got involved in the crypto market, but did so thoughtfully, and not in the manner of Maywather and Kardashian. Case in point, Terry Crews:
EthereumMax was not only “crypto security”, but it was a clean cut fraud from the start to the end. The SEC could have gone with simple fraud charges, as they have done with earlier scams like scam ICOs from 2017, but now they have started to push this “crypto security” term around.
I surely hope Mrs Kardashian got her $250k payment with vesting and cliffed EthereumMax token for her promotion for fraud, instead of dollars.
The SEC added more enforcement staff to their "cyber" unit a few months ago. The number of crypto-related enforcement actions just increased from about two a month to four in one week.[1] Until recently, they were still working down the backlog from the ICO scams of 2018-2019. Now, they're going after much more recent violations.
Does very little to help the laimen that got fleeced in yet another crypto pump-and-dump... I wonder if the whole ordeal was still profitable for her. You know it was for the Eth Max founders. At least they had the guts to officially call it a "crypto asset security"
Does very little to help the laimen that got fleeced in yet another crypto pump-and-dump... I wonder if the whole ordeal was still profitable for her. You know it was for the Eth Max founders. At least they had the guts to officially call it a "crypto asset security"
Yes. The SEC and the regulators are actually doing their jobs for investigating and charging scammers and it doesn't matter if they are as pseudonymous or as famous as Kim Kardashian.
$1.26m is still $1.26m. We don't punish people based on their net worth but on the impact that their actions had.
How much did she get from this crypto deal? 400k? Then her work lost her almost 3x the amount she made. Is she willing to keep paying to work? I don't think so.
She’s not a criminal. She got paid to promote something and she did. Not disclosing it is an ethical dilemma and she’s paid in much more than she made.
Also, if you buy something just because a celebrity told you to, you have poor decision making skills and it’s worth your while to work on that.
[+] [-] 58x14|3 years ago|reply
They gave me a sizable sum of cash up front, no contract, to act as a general and technical consultant. This happened less than 48hrs after I met some of the main "team" which consisted of over two dozen crypto bros and various boxing promoters, none of whom understood the most basic concepts of blockchains, transactions, currency, regulation, etc.
I was with them when they contacted Kim to shill, and I actually advised them to take a much different approach, but of course, I was ignored, and I promptly left the project about a week later.
EMAX is really the epitome of everything wrong in cryptocurrency and I'm glad to see a fraction of justice being served here. Now if only the dozens of other "team" members who were (from my firsthand perspective) equally culpable in defrauding the public could also be held accountable, that would be great.
[+] [-] areoform|3 years ago|reply
Let me be the first to extend my heartfelt congratulations. You avoided the inevitable SEC enforcement action and DoJ indictment!
Thanks to your skill, moral backbone and foresight you're not spending $900/hr/head on a cadre of lawyers. That's better than how most people fare in such a scenario. So, congratulations!
However, you still need to maintain OPSEC and STFU. You've already said things in other comments that aren't the wisest things to say. I would stop right now and call a very good lawyer.
If you don't know how to find one, then call a few and ask whom they'd recommend. Zero in on the choice from there. I sincerely hope that you won't disclose any further details here or elsewhere. Especially in writing.
And remember, DON'T TALK TO THE POLICE (without a great lawyer present), https://www.youtube.com/watch?v=d-7o9xYp7eE
[+] [-] eqmvii|3 years ago|reply
[+] [-] PKop|3 years ago|reply
[+] [-] Waterluvian|3 years ago|reply
Your story seems to put you in the moral right. But what about the legal right? Is it time to get a quick lawyer checkup?
(I’m not implying anything. The answer may very well be a definitive “no, this is a nothingburger.”)
[+] [-] aswanson|3 years ago|reply
[+] [-] DIARRHEA_xd|3 years ago|reply
Don't post about involvement during an ongoing investigation, especially not from your main.
Even if you think you have done no harm. Speaking from experience :)
[+] [-] Meekro|3 years ago|reply
Such a footnote wouldn't have hurt the ad's effectiveness. There were news articles at the time warning people not to take investment advice from Kim Kardashian[1], but that didn't seem to deter people.
[1] https://www.thedailybeast.com/why-is-kim-kardashian-hawking-...
[+] [-] HeyLaughingBoy|3 years ago|reply
Since she certainly has "people" who know this and advise her, I can only assume that they thought that doing this would reduce the effectiveness of the advertising. Someone made a judgement call (heh!) and decided that the expected fine, if prosecuted, was less than she'd make from the promotion.
[+] [-] zeroclip|3 years ago|reply
The problem with crypto is that your average retail user, and probably even a lot of regulators, do not understand the difference between Ethereum and Ethereum Max.
[1] https://twitter.com/ethereum_max
[+] [-] pavlov|3 years ago|reply
[+] [-] unknown|3 years ago|reply
[deleted]
[+] [-] j0hnyl|3 years ago|reply
[+] [-] nailer|3 years ago|reply
Yes they were - not thinking a social media post with '#ad' is an ad is akin to thinking the TV ads are just made by actors that like the products.
[+] [-] the_lonely_road|3 years ago|reply
Twitch streamers are paid to play games all the time. It was one of their large revenue streams. They very rarely if ever mention that it is an ad, but they put in their title #ad exactly like this accusation. Obviously the SEC is unlikely to care bout streamers shilling video games to children, but seems like that could be a problem in the future.
[+] [-] reaperducer|3 years ago|reply
[+] [-] kennend3|3 years ago|reply
https://en.wikipedia.org/wiki/Day-fine
Far too often these fines are simply considered "the cost of doing business".
Worse, in many cases they agree to pay the fine without admitting guilt. It is almost like the government simply wants a cut of the action instead of discouraging it?
[+] [-] Semaphor|3 years ago|reply
But this guy did object the judgement. Well, the objection was overruled, but by now the court had heard of who this was. The new day fine was 2,670€ resulting in a total fine of 80,100€ :D
[+] [-] DLTADragonHawk|3 years ago|reply
[+] [-] happyopossum|3 years ago|reply
[+] [-] ETH_start|3 years ago|reply
There are celebrities who got involved in the crypto market, but did so thoughtfully, and not in the manner of Maywather and Kardashian. Case in point, Terry Crews:
https://podcasts.apple.com/fr/podcast/everyone-can-be-rich-i...
[+] [-] IWorkAtBigCo|3 years ago|reply
[+] [-] adanto6840|3 years ago|reply
[+] [-] miohtama|3 years ago|reply
I surely hope Mrs Kardashian got her $250k payment with vesting and cliffed EthereumMax token for her promotion for fraud, instead of dollars.
[+] [-] happyopossum|3 years ago|reply
I recognize all of these words as English, but I have no idea what you're saying
[+] [-] Animats|3 years ago|reply
It's hammer time for crypto scams.
[1] https://www.sec.gov/spotlight/cybersecurity-enforcement-acti...
[+] [-] dboreham|3 years ago|reply
Also, it can be interesting to read the filings daily posted here: https://www.sec.gov/litigation/admin.htm
[+] [-] seydor|3 years ago|reply
[+] [-] ensignavenger|3 years ago|reply
[+] [-] haasted|3 years ago|reply
[+] [-] captn3m0|3 years ago|reply
[+] [-] djschnei|3 years ago|reply
[+] [-] djschnei|3 years ago|reply
[+] [-] jqpabc123|3 years ago|reply
[+] [-] eqmvii|3 years ago|reply
I hope the investigation keeps going and exposes more of the comedic web of fraud that fuels the crypto ecosystem.
[+] [-] rvz|3 years ago|reply
So there you go.
[+] [-] 300bps|3 years ago|reply
You’re not going to change their behavior.
[+] [-] gtirloni|3 years ago|reply
How much did she get from this crypto deal? 400k? Then her work lost her almost 3x the amount she made. Is she willing to keep paying to work? I don't think so.
[+] [-] pid-1|3 years ago|reply
[+] [-] listless|3 years ago|reply
Also, if you buy something just because a celebrity told you to, you have poor decision making skills and it’s worth your while to work on that.
[+] [-] unknown|3 years ago|reply
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[+] [-] shapefrog|3 years ago|reply
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