In January, the wealthy celebrities were accused of pumping and dumping a mysterious Ethereum-based coin.
Kim Kardashian, a multibillionaire entrepreneur, and Floyd Mayweather are expected to prevail in a case charging them of defrauding investors using the obscure cryptocurrency EthereumMax.
According to Bloomberg, U.S. District Judge Michael Fitzgerald stated in a provisional court judgement on Monday that the attorneys for the irate investors were “trying to play like” the SEC. Tentative decisions reveal a judge’s intended decision in a case before it is heard in court.
The mega-rich celebrities were sued in January by investors who claimed they conspired to drive up the price of EthereumMax tokens before selling them off, leaving others out of pocket.
EthereumMax, often known as EMAX, is a token that utilises the Ethereum blockchain, which powers the second-largest cryptocurrency in the world. Celebrities last year used to promote it, which generated media attention, but it doesn’t seem to be useful.
Fitzgerald reportedly continued, “For obvious reasons, the celebrities did not bother to label the tokens as a security.”
However, Kim Kardashian decided to resolve the allegations that she endorsed EMAX by paying the SEC $1.26 million back in October.
The reality TV personality discussed EMAX’s tokenomics in “a huge news” that she revealed via an Instagram story.
Despite the large compensation, Instagram’s 333 million-follower queen Kim did not acknowledge or deny the regulator’s accusations.
The high-profile matter was taken up by the government organisation, according to SEC head Gary Gensler, since the Instagram post omitted to disclose Kim Kardashian’s compensation for endorsing EMAX, which is a requirement when advertising securities.
Later, Kim’s article was referred to be the “financial promotion with the single largest audience reach in history” by Charles Randell, chair of the UK Financial Conduct Authority.