Kim Kardashian was fined $1.26 million by the SEC for an absolutely shameless promotion of a cryptocurrency scam to her Instagram followers – who number over 250 million. She also agreed not to promote any cryptocurrencies for the next three years. Surprisingly, however, her lawyers claim that she is not required to admit any wrongdoing. The deal really bothered me, so I’m about to vent.
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What happened?
The incident took place in July 2021, when Kardashian made the post below on her Instagram.
Ethereum Max – definitely not to be confused with Ethereum – is (was?) an obscure cryptocurrency token that has risen immensely because of Kardashian’s post. I’m tempted to use the word fraud here, but instead I’ll be nice and say “despicable”. I’ve traced the token’s price action since the Kardashian promotion. They say a picture is worth a thousand words, so here goes: Turns out the “cryptocurrency” promoted by Kardashian was released just a month before her post, and she was paid $250,000 to promote it on Instagram. Within a week of Kardashian’s post, it was down 70%. In one month, it dropped more than 90%. It didn’t take long before it essentially went to zero. Sad.
Kim Kardashian is a predator
It makes my stomach turn to read her post even now, eighteen months later. Kardashian exploited her followers for money, and the language used is abhorrent. “Sharing what my friends told me a few minutes ago” – yes, my friends give me 250k all the time to make Instagram posts, Kim. A large proportion of Kardashian’s followers are minors. An even greater proportion idolize it. It gave what looked like a pyramid scheme its stamp of approval – a copy and paste of the famous Ethereum. The coin’s anonymous founders took a risk – as was always planned, one suspects – and immediately ditched gullible buyers lured by Kardashian’s ad. It’s impossible to know how many followers lost money on Kardashian’s post. Actually, I don’t care, there’s already a lot of bad news in the world. What we do know is that every dollar each follower has invested is now close to zero. In January, when the token dropped 98% from Kardashian investors, she was sued.
How much was Kim fined?
Obviously, what Kim did was incredibly illegal. You can’t wipe a paid ad for a scam as a personal endorsement. So the SEC called her. Unfortunately, Kim is rich and famous, and since these things tend to happen in the US, she barely received a pat on the shoulder. She was fined $1.26 million. To me, this doesn’t even come close to the level of punishment that is deserved given the shamelessness, greed and cold nature of the exploitative post. Kardashian is estimated to have $1.8 billion, which means the fine equates to 0.07% of her net worth. Answer me this – multiply your net worth by 0.07%. Is that number enough to persuade you not to repeat a crime? In fact, it’s even less — it’s a $1 million fine on top of a return on the $250,000 she received. She also didn’t have to admit any wrongdoing. However, she needs to resist the temptation to promote these scams again in the next three years. How people idolize someone like that is beyond me.
I contacted Kim last year (screenshot above), when the token dropped 92%, for his advice. But she still didn’t respond. Maybe if she hadn’t ignored me, she wouldn’t have been sued six months later… The Kardashian brand is ubiquitous, a powerful money-making machine powered by Generation Z. This incident will not affect things and has already been swept under the rug. But I don’t really understand; there have been celebrities canceled for much less than that.
How bad is what Queen Kim did?
Make no mistake – this is stealing money from your unsuspecting followers. I could understand a little if she was paid a fortune, but what is $250,000 for a billionaire like Kim? When complaining about this on my family’s WhatsApp group, my sister (Gen Z) jumped to Kim’s defense. “She is very influential and has achieved more than most people” “She is a very talented entrepreneur” “Don’t be so dramatic” This seems to be most people’s defense. And yes, I agree – she is rich, influential and extremely successful. And does she care that a nobody like me is complaining about her on the Internet? No of course not. But I’m not saying she’s not successful. That’s irrelevant. But it exacerbates how bad of a crime it is, she knew how impressionable her followers were and how influential she was. A quick check for $250K was all it took for her to con her followers. As for being dramatic? Well yes – as I type this this might be a fair point. But the individual stories of people investing in this “cryptocurrency” because Kim lied and said that she and her friends were involved in it – only to lose every penny and realize that Kim was indeed paid and had never heard of the cryptocurrency, let alone invested in it. – is devastating to read. I’m willing to bet these people wouldn’t feel the same if it was their daughter, their son, their friend who lost chunks of their savings, their college fund, their hard-earned money because their “idol” lied to them. The only thing more fraudulent than Ethereum Max is the illusion that Kim Kardashian cares about anyone but herself. Kim, what a shame.
