The U.K.’s financial watchdog has pointed the finger at Kim Kardashian for pushing a cryptocurrency token that might put investors at risk.
Charles Randell, chairman of the U.K.’s Financial Conduct Authority (FCA) and Payment Systems Regulator (PSR), singled out Kim Kardashian in a stern warning about cryptocurrency scams.
In his talk on Monday at the Cambridge International Symposium on Economic Crime, Randell highlighted “the risks of token regulation” and “rules which protect people from investment fraud and scams.”
“There is no shortage of stories of people who have lost savings by being lured into the cryptobubble with delusions of quick riches, sometimes after listening to their favorite influencers, ready to betray their fans’ trust for a fee.”
Kardashian’s Instagram cryptocurrency promotion, according to the FCA’s chairman, “may have been the financial promotion with the single largest audience reach in history,” thanks to her 250 million Instagram followers.
To counter this, the head of the FCA explained how internet sites might provide advice regarding frauds and scams which can aid investors to prevent them making unwise judgments, stating, they would cooperate with online platforms that want to safeguard both consumers and their own businesses – and they would call out those who aren’t playing a part and are undermining the confidence of their customers.
Randell lays the blame on Kardashian
Following this, Randell changed his course of speech:
“Which brings me on to Kim Kardashian. When she was recently paid to ask her 250 million Instagram followers to speculate on crypto tokens by ‘joining the Ethereum Max Community,’ it may have been the financial promotion with the single biggest audience reach in history.”
The celebrity influencer shared a story about EthereumMax in an ad she posted on her Instagram timeline.
Although Instagram regulations compel Kardashian to declare her post as an ad, Randell argued:
“She didn’t have to disclose that Ethereum Max — not to be confused with Ethereum — was a speculative digital token created a month before by unknown developers – one of hundreds of such tokens that fill the crypto-exchanges.”
Ultimately, Randell couldn’t say whether the particular token Kardashian was pushing was a scam or not. But he did, however, point out that scammers regularly pay social media influencers to help them pump and dump new cryptocurrencies based on speculation or even promote fictitious coins that don’t exist at all.
At the end of his speech, Randell highlighted that despite the scams out there, cryptocurrencies are causing a lot of fear of missing out (FOMO) for customers who may have little awareness of the risks involved.